SAN FRANCISCO -- Investors renewed their love affair with Google ( GOOG) after it handily topped Wall Street estimates in the third quarter and undercut arguments that it would bow to economic pressure.

The stock had spent the day in the dumps as investors agonized over whether Google would blow its quarter. But in after-hours trading, shares rocketed 10.5% to $389.91.

The Internet giant reported a profit of $1.35 billion, or $4.24 a share, in the third quarter. Excluding certain items, it earned $1.56 billion, or $4.92 a share. That was well above Wall Street's estimates of $4.80 a share.

Third-quarter revenue was up 31% to $5.54 billion. Excluding traffic acquisition costs, revenue totaled $4.04 billion, falling shy of analysts' estimates of $4.05 billion.

Chief Executive Eric Schmidt made no claims that Google was recession-proof, however. In fact, he opened his remarks on Thursday's conference call with analysts by talking about the economy and the toll it has taken on all companies.

"We're all sort of in uncharted territory," he said.

At the same time, he said Google will continue to take the long view, making investments where needed. The company showed no signs of letting up on the hiring front, adding 500 more employees in the third quarter to bring its total up to 20,000.

Google-owned sites generated revenue of $3.67 billion, or 67% of total revenue, in the third quarter, a 34% increase from a year ago. Google's partner sites generated $1.68 billion, or 30% of total revenue, in the third quarter, a 15% increase from a year ago.

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