According to the report, Google's research spending climbed some 65 per cent, sparking concern about demand about online advertising

Google income rose to $US1.25 billion from $US925 million a year earlier, the company said today in a statement.

Analysts says that "U.S. ad spending will grow 2 per cent this year, down from an earlier forecast of 3.7 per cent, New York-based researcher Magna Global said this month. Google, which got more than half its sales from the U.S. last year, is vying with Yahoo! Inc. and Microsoft Corp. for customers as advertisers look for the most effective way to spend shrinking budgets", says the report.

Bloomberg says that Google fielded about 62 per cent of U.S. Internet searches in May, about double the market share of Yahoo and Microsoft combined.