Betting against Qihoo 360 (QIHU.DL) isn't a smart wager. The company behind China's leading Internet browser and security software suite opened higher this morning after posting better than expected quarterly results last night.

It was pretty spectacular. Revenue soared 141% to $265.1 million, and adjusted earnings more than quadrupled to $73.3 million, or $0.54 per ADS. Analysts were only holding out for net income of $0.34 per ADS on just $228.1 million in revenue, but is that really a surprise? Qihoo 360 has been consistently blasting through analyst profit targets with ease lately.

It hasn't even been close. We're talking about beats of 27% or more over the past year alone.

Quarter

EPS Estimate

EPS

Surprise

Q2 2013

$0.26

$0.40

54%

Q3 2013

$0.37

$0.47

27%

Q4 2013

$0.43

$0.70

63%

Q1 2014

$0.34

$0.54

59%

Source: Thomson Reuters.

Qihoo 360 remains the category leader in online specialties, but that's not enough to explain its heady growth. Monthly active users of its PC-based products and services may have clocked in at a whopping 479 million, but that's just a 5% larger audience than it had a year earlier. Folks using its PC browsers rose by just 2%. The real growth has come from its mobile security platform where users have nearly doubled over the past year to 538 million and its Personal Start-Up Page portal where the average number of daily clicks have exploded from 489 million a year ago to 772 million clicks today.

Naturally, we can also say that search is a major part of the Qihoo 360 story. Ever since it broke into this market two summers ago, Qihoo 360 has been a gobbling up market share. Given the captive audience for its portal, browser, and security software, it's not a surprise to see folks conveniently leaning on Qihoo 360 for their search requests. This finds some traffic trackers reporting that Qihoo 360 is now accounting for a quarter of all Internet queries in China.

That's a pretty big deal, and it's something that Baidu (BIDU -0.26%) investors have been watching closely over the past two years. Baidu commands the lion's share of China's search market, and anything that may disrupt that deserves monitoring.

However, reality paints an entirely different portrait. After the initial fears that held Baidu's stock back when Qihoo 360 began gaining share in search, investors learned to take things in stride. The pie is getting bigger. Baidu's expanding into new revenue streams. More importantly, Qihoo 360 remains lax about monetizing its search platform, and it remains to be seen if the engine's popularity will be sustainable once its loaded with ads.

That last point is pretty important. Baidu generated $1.53 billion in revenue during the same three months that Qihoo 360 rang up just $265.1 million. That doesn't suggest 25% of the paid search market belongs to Qihoo 360, and that's with search accounting for a mere sliver of Qihoo 360's business.

Baidu investors also benefit from having the search behemoth report first. We already knew that revenue climbed 59% in its first quarter. Baidu had already told us that revenue per online marketing customer had risen 44% over the past year. It's not as if Qihoo 360's ascent in search is scaring traffic or advertisers away from Baidu.

Investors don't have to choose one over the other. "Just buy both," I argued two years ago, and both stocks have gone on to handily beat the market. It remains the smartest way to play this game where two companies can continue to win.