Google soars in UK on advertising boom

Google's relentless growth in the UK is continuing as its revenues surged by an estimated 20 per cent to smash through the $4bn (£2.5bn) barrier last year.

The internet search giant behind YouTube, Gmail and the Android phone system reported a 21 per cent rise in UK sales to $1.06bn in the last three months, against $878m a year earlier.

Ian Maude, at Enders Analysis, said British revenues were "marginally down" on his forecasts. But he added: "£2.5bn is pretty sensational. They're by far the biggest advertising business in the UK."

Google's strong showing will raise fresh questions about its British ambitions, amid industry speculation that YouTube could bid for some of the TV rights to English Premier League football. The parent group saw revenues rocket 25 per cent to $10.6bn in the last quarter but net profits were up only 6 per cent to $2.71bn.

Britain, responsible for 10 per cent of group revenues, remains Google's biggest market outside America. However, it has come under fire because it avoids UK corporation tax by diverting revenues via Ireland and other overseas territories. The London operation paid just £8m of corporation tax on more than £6bn of revenues in six years.

Google is benefiting as advertisers continue to shift spending into online and digital at the expense of other sectors. UK marketing clients increased spending on the internet by 13 per cent in the last three months, according to the Institute of Practitioners in Advertising.