Google has announced first quarter profits which have exceeded expectations, despite concerns that it has been facing a slowdown in advertising revenue.

The search engine giant has been experiencing difficulties recently, with a 50 per cent increase in its shares last year being wiped out since the beginning of 2008.

Reuters asserts that the fall was the result of investors fearing the online advertising sector was vulnerable to the slowing US economy.

Google’s net income during the first three months of the year rose to $1.31 billion, from $1 billion in the same months of 2007.

Its revenues for the period reached $5.19 billion.

Eric Schmidt, chief executive officer of Google, commented that the company’s innovation within search, advertising and applications is behind the healthy global growth.

The announcement sent shares in the search engine soaring past the $500 mark.

Colin Gillis, an analyst with Canaccord Adams, told Reuters: "It’s a good time to be a Google bull. The boys delivered."