Apple profits cut as unit sales fall

Apple Computer has reported lower profits than a year ago for its second quarter, but achieved almost the same turnover despite...

Apple Computer  has reported lower profits than a year ago for its second quarter, but achieved almost the same turnover despite a drop in units sold.

The company reported a net profit of $14m (£8.9m), or $0.04 per share. This compares to a net profit of $40m (£25m) and earnings per share of $0.11 in the second quarter of its 2002 financial year. Second-quarter turnover was $1.48bn, down slightly from $1.5bn a year ago.

Analysts had predicted earnings per share of $0.02 and turnover of $1.46bn.

The company shipped 711,000 Macintosh units in the second quarter, down from 813,000 units in the second quarter of 2002. Of that total, 42% were notebooks, led by sales of the 12-inch Powerbook introduced at MacWorld in January. Apple shipped 82,000 units of the 12-inch Powerbook, but delays in availability of the new 17-inch Powerbook limited shipments of that notebook to 14,000 units, said Fred Anderson, Apple's chief financial officer.

Two of Apple's core markets, creative professionals and education customers, have been hit especially hard by the economic troubles of the past year and Apple needs an upturn in the economy to boost sales in those sectors, Anderson said.

The company is delighted with the number of Powerbooks sold in the quarter, he said. But sales of Apple's iMac declined to 256,000 units from 372,000 units in the second quarter of 2002.

Apple expects revenue in the third quarter to be flat compared to the second, and expects to post a slight profit in that quarter, Anderson said.

Separately, Apple issued a statement rebutting speculation that Apple was planning to acquire Universal Music Group.

"Apple has never made any offer to invest in or acquire a major music company," said CEO Steve Jobs.


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