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Google reached 18% profit growth for the first quarter

The revenues of the Internet company Google has increased by 27% in the first quarter, after interest in online advertising continues to grow. The Google's profit falls short, however, with lower growth rates of 18%. The reason for this lies in the increased costs of salaries and company expansion, resulting in its operating expenses jumped by 54 percent over the same period of 2010. The analysts say Google's increased costs are a reflection of its efforts to maintain its lead against the backdrop of an increasingly dynamic competition in Silicon Valley. The operating costs include salaries, marketing and research increased by 54 percent and accounted for one third of the company's revenue for the quarter. Google has invested heavily in hiring new employees and salaries as well as new products in recent months. The costs for its research and development reached 1.23 billion dollars for the quarter compared to 818 million dollars a year ago. Cost of sales and marketing jumped sharply by 69% annually, surpassing $ 1 billion. Google also increased by 10% the salaries of its employees, which raises the costs of its this year. Internet company also has invested significantly in its brand managers to keep them from growing competition from Facebook and Twitter. The shares of Google fell 5.4 percent after the regular session of the Nasdaq stock exchange to 547 dollars.
The net profit of the company rose to 2.3 billion dollars or 7.04 dollars per share, compared with 1.96 billion dollars or 6.06 dollars per share a year ago. The revenues for the quarter amounted to 8.58 billion dollars compared with 6.78 billion dollars for the same period of 2010. Meanwhile, its operating expenses jumped from 1.84 billion dollars 2.84 billion dollars. In late March, Google has 36.7 billion dollars cash.