Google and IBM are the latest technology sector companies to
report higher-than-expected third-quarter results, providing
further evidence of global economic recovery.
Google is among only a few technology companies reporting actual
revenue growth, but results from IBM, Intel and AMD have all
exceeded analyst expectations.
Google's net revenue in the third-quarter rose 8.5% from a year
earlier to $4.38bn, beating the $4.24bn expected by analysts.
Net income was $1.64bn compared with $1.29bn a year earlier and
profit per share was $5.89, beating the $5.42 expected by analysts,
according to Thomson
Reuters.
Eric Schmidt, chief executive at Google, said although there is
still uncertainty about the pace of economic recovery, Google
believes the worst of the recession is over.
"We now feel confident about investing heavily in our future,"
he said.
Analysts said advertisers are starting to invest in the fourth
quarter, encouraged to spend online by an upturn in e-commerce.
IBM raised its full-year outlook and reported
higher-than-expected quarterly profit on higher-margin software and
services.
IBM reported third-quarter net profit rose to $3.2bn or $2.40 a
share, beating average analyst expectations of $2.38 a share,
according to Thomson
Reuters.
Revenue fell 7% compared with the same period a year ago to
$23.6bn, but was up 1% on the previous quarter and was better than
the $23.4bn expected by analysts.
IBM forecast a return to revenue growth in the fourth quarter
and said it was ahead of schedule to achieve its target earnings of
at least $10-a-share next year.
Intel led the run of good tech sector results by
exceeding market expectations on Tuesday, as did rival AMD
later in the week.
The extent of the turnaround for the technology sector will
become clearer next week when Apple and Microsoft are due to issue
third-quarter financial results.
The only exception this week to the positive trend is Nokia,
which reported a third-quarter loss $834m after a $1.4bn write-down
at its joint venture network unit Nokia Siemens.