Google reports good first quarter in all sectors

Google has reported a good first quarter for the year, with revenues rising 23 percent year on year to US$6.7bn.

The company reported that the US market for search is recovering more strongly than expected and advertisers are starting to spend again internationally. Overseas revenue, which accounts for 53 percent of Google's business, rose 24 per cent, with strong growth in Eastern Europe and South America.

"As we enter 2010, it's clear that the digital economy continues to grow rapidly," said Patrick Pichette, Google's chief financial officer.

"It's been a very positive start to the New Year. Large advertisers have come back in force, reflecting an improving economy."

Google is in the middle of a major recruitment drive for engineers and sales staff he said. While the company would be maintaining it's high level of entry qualifications it also had projects sitting on the back burner because of shortages of staff he said.

Android was performing well, with 60,000 new handsets activated each day and 34 devices now available from 12 different OEMs. The App Store has has grown by over two thirds to 38,000 applications and thousands of business applications now being sold.

Google released few figures for the Nexus handset, although it did say the division was profitable and had contributed to the US$300m in additional sales the company had made outside the search business. It was also an important driver for more mobile searches.

“We're taking a mobile first approach at Google,” said vice president of engineering Jeff Huber.

“Voice search is increasingly ubiquitous and we're using the unique characteristics of mobile smartphones to be location aware for new services. Tools like the 'Near me now' link under the search box are proving very popula r.”

When asked about the company's relationship with Apple Huber would not be drawn, but said just that the two companies had a long histroy of working together and he hoped that it would continue.

As for the situation in China Pichette said that very little had changed and the company would continue to do sales and engineering in the country, just not censor its search results.

“We still have sales in China and the fact that we serve them in Hong Kong doesn't stop us from getting the opportunities we want in Chinese market. We stopped censoring but the access to Google is still available to all Chinese people,” he said.

Nevertheless the decision had been a tough one he said but the company had to remain true to its values.

This was the first Google earnings call that didn't feature Eric Schmidt and Pichette was asked point-blank if this was down to a conflict within Google management over the China decision.

“I've heard every rumour, thank you, but there's nothing going on at all. But thank you for asking the question with such candor,” he said.