FUTURISTIC GROOVES

Google Inc.’s first-quarter profit surged to a nearly six-fold improvement as the online search engine leader continued to surpass the bullish expectations for its high-flying stock.

The Mountain View-based company said Thursday that it earned $369.2 million, or $1.29 per share, for the three months ended in March. That compared with net income of $64 million, or 24 cents per share, at the same time last year.

Revenue totaled $1.26 billion, nearly doubling from $651.6 million at the same time last year. After subtracting commissions that Google paid to other Web sites in its advertising network, the company’s first-quarter revenue was $794.5 million.

These blow-out quarterly earnings are powered by the continuing boom in advertising linked to search engine results.

Google makes virtually all of its money from the text-based ads that are tied to online search requests. The company gets paid each time one of the links are clicked on Google’s home page or hundreds of other sites that display the ads.

The text-based ads, which are priced using an online auction system, are becoming more expensive. Advertisers bid an average of $1.75 per click in March, a 6 percent increase from February, according to Fathom Online, a research firm.

Many analysts believe Google has devised a better formula than main competitor Sunnyvale-based Yahoo, for deciding which ads are most closely related to a search request, resulting in more revenue-producing clicks.

Google also is making more money internationally. The company generated 39 percent of its revenue overseas in the first quarter, up from 35 percent in the previous quarter.

For all its success, Google still faces plenty of challenges, starting with software giant Microsoft Corp.’s resolve to grab a piece of the lucrative search engine advertising market.

Google also is entering a stretch when Internet traffic traditionally has dropped off as people spend more time outside to enjoy warmer weather and more daylight in the evenings. That pattern might result in fewer Internet searches, slowing Google’s growth in the second and third quarters.

Furthermore, earnings soared past estimates in the first three months of the year, feeding an after-hours rally that took the company’s shares back to the high point they touched early this year. Eric Schmidt, chief executive officer, said that Google was still a long way from reaching saturation in any of its new advertising markets. “We’re just at the beginning of the penetration of this technology,” he said. “There seems to be plenty of upside.”