Strong sales of iMac sales helped Apple Computer Inc second quarter net income surge 145% to $135m including a $50m gain for the sale of ARM shares and an $8m restructuring charge over $55m on revenue up 9% at $1.53bn over $1.4bn. It beat analysts’ estimates by three cents, reporting earnings per share of $0.60.
It shifted 827,000 units in the second quarter, 27% more than in the year-ago period. It claims 11.2% of the channel – double last year’s share – while unit growth was 52% in the Japan, 26% in Europe, 41% in Asia/Pac and 19% in the US. PowerPC G3 systems comprised 43% of sales. Average selling price was $1,803, up from $1,776 sequentially but down from $2,090 compared with last year. Gross margins declined to 26.3%. It claims 32% of iMac buyers are first time computer buyers with a further 11% WinTel converts.
In Japan the figure is even higher where 46% are first time buyers – 18% of them WinTel converts. It sold 80,000 233MHz iMacs in the quarter before obseleting that model. A new ‘Rev D’ 333MHz model introduced yesterday starting at $1,200 will replace the 266MHz model. International sales were 50% of overall sales. It won’t say how much it sells over the internet. It has 8,300 employees, down from 8,700 last quarter. It ended the quarter with $1bn cash. It expects to record year-over-year unit and revenue growth for the coming third quarter, which is the beginning of the education industry’s buying season.
There is a lightweight portable on the way touted as iBook, but Apple thinks there is demand for at least two other classes of laptop including PowerBook. Apple will also reduce its debt by calling its 6% convertible subordinated debentures due June 1, 2001. It is offering to buy back the debentures or holders can convert them into Apple common stock at $29.205 per share until June 1 this year. It expects the majority to convert. At the half way mark net income was up 181% at $287m over $102m on revenue up 8.7% at $3.24bn over $2.98bn.
