The world's second largest biotechnology company by sales posted a net profit of $731 million, or 68 cents per share, compared with a profit of $685 million, or 64 cents per share, a year ago.

Excluding items, Genentech earned 81 cents per share. Analysts on average expected 89 cents per share, according to Reuters Estimates.

U.S. sales of Avastin, widely considered the most important barometer of Genentech's growth, rose 18 percent to $704 million.

That exceeded analysts' estimates of $694 million and the $650 million recorded in the previous quarter.

Genentech shares dipped as low as $70 last week amid concerns the global credit crisis would hamper Roche's ability to finance its $43.7 billion, $89 per share, offer to buy the portion of Genentech it does not already own. They had risen as high as $99.05 in mid-August.

(Reporting by Bill Berkrot; Editing by Andre Grenon)