A little rain may be about to fall on Google's parade

Net income in the last three months of 2005 rose to $372.2m (�209m) from $204.10m a year earlier, lifted by a strong demand for online advertising.

That works out at $1.22 per share, well below the $1.50 expected by analysts.

The results will fuel concerns that Google's shares are overvalued and the stock tumbled in after hours trading.

'Going to be hurt'

Google dropped 14% in extended electronic trading in New York, and at one point were trading almost 20% lower.

"They missed. Revenues are in line, but it was a big earnings miss," said Tim Ghriskey, chief investment officer at Solaris Asset Management.

"This is a competitive market. When a company selling at this valuation misses earnings to the degree it missed here, the stock is really going to be hurt."

Google said sales revenue grew 86% to $1.92bn as new features including its e-mail service Gmail helped it attract internet users.

Search engine rival Yahoo! also disappointed markets with its earnings report a couple of weeks earlier.

No plans

Earlier in the day, Google denied it had plans to buy music download company Napster.

A report in the New York Post claimed that Google was mulling plans to work with Napster to offer music downloads.

There already had been speculation that the company may be interested in moving into the music business.