Thursday's late surge stood in stark contrast to the reaction Google garnered in July with its second-quarter report, which spooked Wall Street with talk of a seasonal slowdown in the fall. Google's late advance put it back above $320 for the first time in a month.
"Clearly, in hindsight it looks like it was a boilerplate cautionary statement that they were making," Chervitz said, referring to July's seasonality comment. "It makes sense that some investors and analysts were wondering how serious to take the statement."
Earlier this week, archrival Yahoo! beat analysts' third-quarter profit expectations and reaffirmed its fourth-quarter guidance. But
shares tumbled Thursday after investors turned on the world's largest Internet auction site over its weaker-than-expected guidance.
Investors await reports in coming weeks from Internet titans
Google, founded seven years ago by two graduate students, continues to dominate the search market, garnering 45% of queries as of September. That puts it comfortably ahead of Yahoo!, which had 23%, according to Nielsen/NetRatings.
(MSFT - Get Report)
MSN had 12% of the market, followed by
America Online with 8%, and AskJeeves, now owned by IAC, with 2.5%.
The Nielsen/NetRatings data highlight the challenges facing Google as it looks to win away users from Yahoo!, whose site is the Internet's most visited, through features such as email and local searches.
"Google is on top now, but searchers are finicky," said Jennifer Laycock, an industry analyst and editor of
. She says Google's market position is safe for now, adding, "If you go to a high school or college campus and ask people about search, many of them don't know there is an alternative to Google."