Google Profit Up 36% as Paid Clicks Swell

Google posted its best profit growth in more than a year, as the Internet search giant counteracted lower advertising rates on mobile devices by selling a higher volume of ads.

Google posted a 36% increase in third-quarter net income, on a 12% jump in revenue, reversing a disappointing quarter three months ago. The results show Google's ability to draw clicks as more users reach its sites from mobile devices, such as smartphones and tablets. The challenge for Google and other Internet firms is that ads on mobile devices sell for significantly less than those on personal computers. Executives said a new policy implemented in July called "enhanced campaigns" that pushes marketers to place ads on phones as well as computers appears to be working. Two closely watched measures of Google's ad business -- paid clicks and cost-per-click -- continued to diverge. Paid clicks grew 26% compared with the prior year, the highest growth rate in a year. But the average price that advertisers paid Google when people clicked on ads fell 8%, making it two years of declines. Google remains well ahead of online-advertising rivals, commanding one-third of the world-wide market in 2013, researcher eMarketer estimates. Nearest rival Facebook Inc. will have just 5% market share in 2013, though its share has climbed more quickly than Google's in the past two years, the market-research firm estimates.