Google, with an assist from Uncle Sam, beat Wall Street.
The search giant announced earnings results of $11.58 a share yesterday, topping most analyst forecasts.
However, without approval of a tax credit that lowered the company’s rate to 8 percent, Google would have fallen short of expectations, according to analyst Colin Gillis of BGC Partners.
“The reality is that the beat came from the tax rate,” Gillis said. “Google never had an 8 percent rate before.”
Last quarter’s tax break was for research and development.
Google recorded nearly $14 billion in revenue in the first three months of the year, an increase of 31 percent year over year, including money from Motorola Mobility, which it bought last year.
The advertising business was up 22 percent, generating $12.95 billion. Profits were up 16 percent, to $3.35 billion.
Google also showed some improvement in costs per click, the amount advertisers pay every time a user taps an ad online.
The click prices were down just 4 percent in the first quarter, compared to a 6 percent drop in the previous three-month period and 15 percent in the quarter before that.
The costs for advertisers started coming down as more users began using the Internet from mobile devices, where ads are cheaper. Google recently implemented new bidding rules meant to unify the cost of keywords across mobile and desktop.
The number of ads clicked have been increasing steadily, and last quarter they were up 20 percent.
Revenue from Google sites, the measure of the core business, was up 18 percent, to $8.64 billion, a sign of maturing, Gillis said.