Originally created 04/15/04

Apple's second-quarter earnings triple



SAN JOSE, Calif. -- Huge demand for its iPod portable digital music players helped Apple Computer Inc. triple its second-quarter earnings and easily beat Wall Street expectations.

The Cupertino-based computer maker said Wednesday its net income was $46 million, or 12 cents a share, for the three months ended March 27. In the year-ago quarter, Apple reported net income of $14 million, or 4 cents a share.

Sales were $1.91 billion, up 29 percent from $1.48 billion reported in the year-ago period.

Excluding a one-time after-tax restructuring charge of $7 million, the company's net profit for the quarter would have been $53 million, or 14 cents per share.

Analysts polled by Thomson First Call were expecting earnings of 10 cents per share on revenue of $1.8 billion.

"The iPod probably accounted for probably half of that (revenue) growth," Fred Anderson, Apple's chief financial officer, said in an interview.

The company reported record sales of 807,000 iPods for the quarter, up more than 900 percent from the prior year, bringing the total to about 2.8 million since the gadget was first introduced in 2001.

Extremely high demand for the iPod Mini, introduced in the United States in January, led Apple to delay the smaller model's international release to the end of July.

Sales of iPods gained momentum after Apple introduced its pay-per-download iTunes online music store, first for Mac computers last April and then for Windows-based PCs in October. Songs purchased from the online store can be burned onto CDs and played on up to three computers, but are transferable only to the iPod.

Anderson said the company expects revenues for the third quarter to reach $1.93 billion, and earnings per share of 12 cents or 13 cents.

The company also expects to incur some restructuring charges due to its closure of manufacturing operations in Sacramento. Apple plans to move most of its California-based manufacturing activities to a supplier in Southern California.

Apple shares fell 29 cents to $26.64 on the Nasdaq Stock Market before the earnings were released. They rose $2.46, or more than 9 percent, in extended trading.

On the Net:

Apple Computer: http://www.apple.com