Auto ads help Google earnings gain 27%

As far as Google (GOOG) is concerned, the recession is practically over.

"We believe the worst is behind us and now feel confident about investing heavily in our future," Google CEO Eric Schmidt said Thursday as the company reported a 7% increase in third-quarter revenue from a year ago, to $5.9 billion.

Earnings were up 27% to $1.6 billion, mostly from increased auto advertising – thanks to the government's "cash-for-clunkers" program – and retail. Both travel and finance continued to be weaker than they were.

"Google is clearly taking advantage of companies looking for advertising they perceive to get more bang for their buck," says Whit Andrews, an analyst at Gartner. "Despite being under renewed pressure from a variety of different sources, Google has been quite strong."

Google, which had cut back on hiring, plans to begin beefing up its engineering staff. It has 20,000 employees. [Read More]