Apple Computer Inc’s fiscal first quarter figures, showing earnings per share soaring 33%, and, more importantly, gross margin at 51.4% of sales, only marginally down on the 52.0% of a year ago – gross margin is the profit before selling expenses and overheads – make it clear that fears that introduction of truly competitive models of the Macintosh meant an end to the days of good profits were premature. The company’s strategy as expressed by chairman John Sculley is to increase significantly the installed base of Macintosh users by offering the computers people want at more affordable prices, and the so far, so good impression is bolstered by the news that worldwide unit shipments of Macintosh computers grew about 50% during the first fiscal quarter from the year-ago level. Another strategy that is working – helped by the fadeaway dollar – is that of building foreign business as a proportion of the tota: foreign business accounted for 45% of the $1,676m total for the quarter, up from 36% this time last year. There is a caution on the gross margin figure discussed above – Apple comments that if the results had been calculated at exchange rates prevailing a year ago, gross margins would have been down sharply at 48% of sales.
Bill Campbell, president and chief executive of Apple’s Claris Corp software subsidiary, is leaving the company to assume the same titles at Go Corp, the Foster City, California start-up formed to develop pen-based data entry and interaction technology. Jerry Kaplan moves over at Go to be chairman. The news didn’t go down well on Wall Street, and Apple’s shares, which had risen 62.5 cents on the figures, slumped $2.50 to $47.625 Friday morning.
