Google’s Q1 revenue rises 79% year-over-year to $2.25 billion

Showing no signs of slowing down, Google Inc. reported $2.25 billion in revenue for the first quarter ended March 31, up from $1.25 billion a year ago. Net income rose 60% to $592.3 million from $369.2 million.

Revenue from Google AdWords on Google-owned web sites rose to $1.3 billion, up 97% from a year ago, while revenue generated through Google’s AdSense program on partner sites rose 59% to $928 million.

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International revenue accounted for 42% of total revenue, up from 39% a year ago. As of March 31, Google reported $8.43 billion in combined cash, cash equivalents and marketable securities.

The company said it had Q1 capital expenditures of $345 million and will continue to invest in its IT infrastructure, including servers, networking equipment, data centers and real estate. “We expect that the growth rate in capital expenditures in 2006 will be substantially greater than the revenue growth rate for the year,” Google said.

Safa Rashtchy, senior research analyst for Piper Jaffray & Co., said Google continues to have the “most innovative platform” on the Internet and that it can be expected to continue its leadership in innovation beyond paid search. He added that Google showed faster than expected Q1 revenue growth both in the U.S. and internationally.

Google continues to dominate Internet search traffic, with a 49% share in March amounting to 2.9 billion searches, up 41% from 2.06 billion searches a year ago, according to Nielsen/NetRatings. By comparison, second-ranked Yahoo’s share was 22.5% with 1.33 billion searches, up 47% from 905 million searches a year ago.