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By Jeremy Glaser | 04-15-2010 05:53 PM

What's Driving Google's Growth

Google has been much more disciplined than we'd anticipated, says Morningstar analyst Larry Witt.

Jeremy Glaser: For Morningstar.com I am Jeremy Glaser. Google beat analysts' expectations again in the first quarter. I am here with Morningstar equity analyst Larry Witt to talk a little bit about what drove this high performance.

Larry, thanks for joining me.

Larry Witt: Absolutely Jeremy. Thanks for having me.

Glaser: What was the most surprising aspect of this earnings release for you?

Witt: One thing that is important to point out is that Google's revenue not only continues to grow, but it has accelerated over the last three quarters. So revenue growth is getting stronger. We think there are a few things really benefiting Google right now.

First of all you have the secular shift of advertising online. Google continued to take market share within that category. But also as the advertising market is improving overall, thanks to a stronger economy, you have seen their revenue growth accelerate over the last few quarters. And I think that is a pretty good indication that other media businesses will fare better this quarter than they have over the last couple of years.

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