Apple tops estimates
Published: 19 Apr 2001 08:02 BST
Buoyed by shipments of new models, Apple Computer reported a fiscal second-quarter profit on Wednesday that significantly topped Wall Street estimates.
However, Apple also reduced its outlook for the second half of its fiscal year.
Excluding a gain and a write-down related to its investment portfolio, Apple earned $40m (£28m) in its second quarter on revenue of $1.43bn (£1bn).
Although analysts' predictions varied considerably, the consensus estimate was slightly lower, according to First Call. Revenue was expected to be $1.38bn (£950m) for the quarter, which ended 31 March.
In its second quarter last year, the computer maker earned $233m (£163m) on revenue of $1.95bn (£1.37bn).
The quarterly earnings are in sharp contrast to a brutal $247m (£172m) operating loss in Apple's fiscal first quarter.
"We had a lot to accomplish in the March quarter, and we're very pleased that our results exceeded expectations in a very challenging environment," Apple Chief Financial Officer Fred Anderson said on a conference call with analysts.
As for its outlook, the company now expects to bring in $3.2bn to $3.4bn (£2.24bn to £2.38bn) during the second half of its fiscal year -- down from a prior estimate of $3.6bn (£2.52bn).
"We're taking into account the tough environment we're in," Anderson said.
Apple shares surged 14 percent to $26 in after-hours trading, according to Island ECN. In regular trading ahead of the report, Apple shares rose $2.39, or 12 percent, to close at $22.79.
The computer maker said it shipped 751,000 Macintoshes during the quarter. The company added that it reached its goal of having four weeks of inventory in the hands of retailers and distributors, which Apple says is ahead of schedule. Anderson said Apple had previously predicted it might take take a few quarters to reach the four-week level.
Anderson characterized Apple's Titanium PowerBook G4 as a hit, saying the company shipped 115,000 of the notebooks in the quarter and expects to reduce its backlog of orders for the sleek portable to a normal level by the end of April.
Apple also benefited from falling prices for parts.
"Component costs continued to soften during the quarter, and we were able to take advantage of that," Anderson said.
Apple said in January that it expected a slight profit in its second quarter.
David Bailey, an analyst at Gerard Klauer Mattison, said strong sales of Apple's corporate products, particularly the new PowerBook, helped the company to beat predictions.
"That's really what allowed them to come in ahead of expectations," said Bailey, who had forecast Apple would earn 2 cents a share.
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