I have not seen .xxx domains ranking well in Google, Bing or Yahoo and was wondering if anyone knows the search engines are biased against .xxx sites or if there is any sort of penalty against rankings when a domain ends in .xxx thanks!!
I don't think there are tons of developed .xxx sites out there right now..That may be part of the reason you don't see them in the results much. Recently, ICM registry (owners of .XXX extension) launched search.xxx which is a search engine only for .xxx websites. They've done some promotion with that recently so if you have a developed .xxx you could submit it there and possibly see some traffic from it.
Just to clarify you all. Getting links is not a problem for these huge companies behind .xxx domains, so it's not a reason for their low ranking, because they are used to pay a lot for links and advertisement, just as regular .com adult sites. I think there is some kind of down ranking placed on them (penalty is a completely different thing), that's why we can not see any of them ranking high for their adult keywords, Google already knows that these sites provide adult content and don't want to show it to everyone. I think you can see some of them in top when you remove content filter from search results.
There are many xxx sites that's ranking are nice not today rather than it is on ranking from more than 2 years by specific keywords, I don't know how these sites are ranking well, Is Panda and Penguin are able to rank it down.