. >> tom: joining us with more-- scott kessler. he follows google as senior director of technology research at s&p capital iq. with us tonight in new york. scott, how do you describe these quarterly results from google, blew estimates out of the water. >> yeah, tom, i would say having covered the stock for more than seven years, probably between good and great. google over the years has really delivered time and time again. this quarter was no exception. what was surprising to us was the combination of accelerating revenue growth for the fourth straight quarter as well as continuing improvement in margins reflecting well controlled costs and expenses. that's a combination that i think investors seem to like after-hours. i want to ask you about expenses because we see's big increase. lots of hiring going on but it still owns two-thirds of the internet search market according to the latest statistics and tonight's report, google is making even more money per click, two-thirds of the internet search market goes to google. is it going t

but analyst scott kessler says shareholders should be jumping for joy because apple will no longer make separate devices for every carrier. >> that's actually going to contribute to higher gross margins, and so we actually raised our estimates for fy '12, which ends in september, and increased our target price to $495. >> reporter: apple hasn't had a new phone in more than a year, and that has allowed inroads from competitors like android. branding expert david lipkin says staying well ahead of the pack is important to the apple mystique. >> a big part of what people get excited about are new products, new features, updates. it's part of what drives revenue for them. so, in the same way that people like updates to applications, they like new products. it's one of the things that helps keep people loyal. >> reporter: but for apple users, it doesn't matter what you call the newest phone, they already love it. >> everything is just simple. i have a blackberry, too, which i hate. i personally think blackberry should go out of business. they don't know how to make media centric products. >>