Google has reported a dip in profits during its third-quarter earnings call, Digital Spy said.

The internet giant raked in $2.8 billion during the period in question, down 5% from the same period last year. Revenue increased by 20% to $16.52 billion in the three months ending September 30, but this figure was shy of analysts' estimates.

The downturn was attributed to a rise in real estate and hardware inventory costs, but Google is confident that gains in its advertising business will rectify the situation.

"We continue to be excited about the growth in our advertising and emerging businesses," said Google chief financial officer Patrick Pichette.

Google will also be hoping that the release of its new Nexus 6 smartphone and Nexus 9 tablet will help claw back the hardware inventory deficit.