Google Inc. shares hit an all-time high on Friday, propelling the search giant’s market capitalization well past $400 billion, after the company reported strong results for its second quarter.
Shares rose as much as 15.5% to $695.25 in morning trading, easily topping its previous high of $615.03 a share from February 2014. The company’s stock had already gained 13.4% this year through Thursday’s close.
More recently, the stock traded at $693.13, giving the company a market value of $473 billion, according to FactSet.
The surge follows Google’s quarterly report that handily beat Wall Street expectations after the bell Thursday. Analysts were particularly cheered by Google’s stronger-than-expected revenue growth and tighter controls on costs.
In a research note, Nomura analysts said Thursday’s results help allay some concerns surrounding Google, such as that its desktop search is declining and expense growth is outpacing revenue increases.
Excluding currency fluctuations, revenue rose 18% from a year earlier, compared to 17% growth in the first quarter. Google attributed growth to strength in its core search business, mobile and YouTube.
Meanwhile, second-quarter operating expenses, which include research and development as well as sales and marketing costs, totaled $6.4 billion, down slightly from the first quarter.
“Google hasn’t delivered a quarter like this in a long time,” J.P. Morgan analyst Doug Anmuth said in a note.
The company’s new financial chief, Ruth Porat, hinted on Thursday that Google, which has never repurchased stock or paid a dividend, might distribute some of its cash to shareholders. She suggested Google could issue debt to finance the program, or for acquisitions and other investments.
Some analysts and investors have expressed concern that Google’s main search-advertising business is vulnerable to the smaller screens of smartphones and the rise of mobile apps, trends that have pressured its advertising prices. The price of Google’s mobile search ads is still lower than those on personal computers, but Ms. Porat said that gap is narrowing.
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