Google also announced a stock option exchange program intended to keep its employees happier.
For the quarter ended December 31, the company reported net income of $382 million, or $1.21 per share, a big decline from the $1.21 billion from the year earlier. Factoring out various costs, including stock-option expenses, though, the result was $5.10 per share, 15 cents above the $4.95 expected by analysts surveyed by Thomson Reuters.
Total revenue was $5.7 billion, a 24 percent increase over the $4.83 billion from the year-earlier quarter. Excluding $1.48 billion in commissions paid to partners, called traffic acquisition costs, Google had $4.22 billion in revenue, ahead of analysts' projections of $4.12 billion and the year-earlier $3.39 billion.
"Google performed well in the fourth quarter, despite an increasingly difficult economic environment. Search query growth was strong, revenues were up in most verticals, and we successfully contained costs," Chief Executive Eric Schmidt said in a statement. "It's unclear how long the global downturn will last, but our focus remains on the long term, and we'll continue to invest in Google's core search and ads business as well as in strategic growth areas such as display, mobile, and enterprise."
By Stephen Shankland