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Google reports modest Q1

Google reported a 6% increase in first quarter earnings over the same period last year and a 3% decrease compared to the fourth quarter of 2008.

Google released its first quarter earnings today during a conference call with investors. The leader in search market share reported revenues of $5.51 billion for the quarter, which ended March 31, compared to $5.19 billion for the same period last year and $5.7 billion in Q4 08.

“Despite the tough economic climate, we think Google had a good quarter,” said Eric Schmidt, CEO of Google, during the conference call. “While revenues were down quarter over quarter, they grew 6% year over year, thanks to continued strong query growth.”

Google-owned sites generated revenues of $3.7 billion, or 67% of total revenue. This represents a 9% increase over the first quarter of 2008, when Google-owned sites generated $3.4 billion and a 3% decrease from the fourth quarter of 2008, when Google sites generated $3.81 billion.

Operating expenses, other than cost of revenue, were $1.52 billion in the first quarter of 2009, or 28% of revenue, compared to $1.65 billion or 29% of revenue in the fourth quarter of 2008.

GAAP net income for the first quarter of 2009 was $1.42 million as compared to $382 million in the fourth quarter of 2008. Non-GAAP net income was $1.64 billion in the first quarter of 2009, compared to $1.62 billion in the fourth quarter of 2008.

As of March 31, the company reported cash, cash equivalents and marketable securities of $17.8 billion. Google employed 20,164 full-time employees as of March 31, down from 20,222 full-time workers as of December 31.

Schmidt also commented on Google’s outlook on the current recession.

“Looking at the economic situation, we are still in uncharted territory. The current economic environment remains tough and no company is recession proof,” he said. “Users are still searching but they are buying less. Users are doing what you would expect them to do given the situation. We think Google is now well placed for the recovery when it occurs.”

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