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Shares in Google hit $582.8 up up 18.51% in early Friday morning trade on Wall Street, as investors cheered news that the internet giant's advertising and web business had stood up better than expected in the face of the US economic slowdown.

US investors were expecting potentially gloomy first-quarter results from the one-time stock market darling over fears its phenomenal growth rate cannot continue in the long term.

However, Google has surprised Wall Street and the industry with an upbeat set of results, despite a series of dismal research reports that suggested the number of people "clicking through" to paid-for ads has reduced sharply in the three months to March.

The reported a profit after tax of $1.31bn (£655m) in the three months to March, while aggregate paid clicks rose by approximately 20% on the first quarter of 2007, and 4% over the fourth quarter.

Revenue excluding the share Google has to pay out to its partners in traffic acquisition costs came in at $3.7bn, again higher than analysts' consensus that had predicted $3.61bn.

Google's shares surged more than 17% in after-hours trading to $530 after it reported the first-quarter profit. Before the earnings were released, Google's shares had dropped 35% since the beginning of the year.

The results suggest Google is weathering wider economic trends in the US economy brought about by the credit crunch.

Eric Schmidt, Google's chairman and chief executive, told investors in a conference call that the company's web search and advertising business has seen no impact from macroeconomic weakness.

He said: "On the macro side, we've looked at this really carefully and we do not see an impact as of this time.

"Our conclusion is that we're well positioned, should economics change, to continue to do well because our model is so targeted and targeted advertising does well in pretty much most scenarios, we think."

Separately, Google is reported to be close to taking over 's web search advertising as part of its rival attempt at blocking Microsoft's unwanted $42bn takeover bid.

Yahoo! is working on a two-pronged attempt to defend itself through a partnership with Google and a merger with Time Warner's AOL.

The upcoming deal between Google and Yahoo! follows an announcement last week of a trial run of Google's technology on Yahoo!'s website.