New York (USA) – Google shares fell ten per cent even after the Internet giant reported a 27 per cent increase in revenues for the last three months of 2011. The seemingly good news about revenue increase send the shares tumbling because the quarterly earnings missed estimates as money paid by marketers for its search ads fell for the first time in two years.

It reported 3-month revenues of $10.6 billion. The net profit rose 6.4 per cent to $2.7 billion. But this was not enough to meet market expectation as search giant under performed on both revenue and earnings, disappointing investors who had counted on record US online-commerce to prop up results, prompting several brokerages to cut their price targets on the stock.

Google also saw a surprise downturn in the prices that it collects for each click. The number of clicks on Google’s search adverts however rose significantly in the fourth quarter, but the amount that Google was able to charge advertisers for each click fell 8 per cent. Google shares fell 10 per cent in after-hours trading to $575.

“Google had a really strong quarter ending a great year,” said chief executive Larry Page.  “I am super excited about the growth of Android, Gmail, and Google, which now has 90 million users globally – well over double what I announced just three months ago.”  The company is looking to this year’s release of the Windows 8 operating system and a new category of PCs called Ultrabooks, which analysts hope will lead to a strengthening in sales as the year progresses.