Apple Quarter Up, Despite Stock Issues

By Colleen Taylor -- Electronic News, 10/19/2006

High-flying consumer electronics company Apple Computer Inc. has announced preliminary financial results for its fiscal Q4 ended September 30 with revenue of $4.84 billion, up from Q3 revenues of $4.37 billion and $3.68 billion revenues in Q4 2005.

The company also reported net profits of $546 million, up from Q3’s $472 million and Q4 2005’s $430 million. Gross margin was 29.2 percent, up from 28.1 percent in the year-ago quarter, but down from Q3’s 30.3 percent. International sales accounted for 40 percent of Q4’s revenue, the company said.

Tempering its sunny Q4 preliminary financial results with a warning of the possibility of significant adjustments when it restates its historical results due to stock options granting irregularities, Apple noted that it shipped 1.61 million Macintosh computers and 8.73 million iPods during the quarter, up from the 1.3 million Mac sales and 8.1 million iPod sales it posted for Q3. The company posted 30 percent growth in Macs and 35 percent growth in iPods over the Q4 2005, as well.

“This strong quarter caps an extraordinary year for Apple. Selling more than 39 million iPods and 5.3 million Macs while performing an incredibly complex architecture transition is something we are all very proud of,” Steve Jobs, Apple’s CEO, said in a statement. “Looking forward, 2007 is likely to be one of the most exciting new product years in Apple’s history.”

Looking ahead to Q1 2007, the company said it expects revenue of $6 billion to $6.2 billion.