Apple Quarterly Profit Soars 88% on IPod, Mac Sales

[AlSi]

http://www.bloomberg.com/apps/news?p...d=aGuHuoEzJN5I

April 25 (Bloomberg) -- Apple Inc. said second-quarter profit rose 88 percent after demand soared for its iPod media players and Macintosh computers. The company's shares surged 6.3 percent in extended trading.

Net income increased to $770 million, or 87 cents, from $410 million, or 47 cents, a year earlier, the Cupertino, California-based company said today in a statement. Analysts surveyed by Bloomberg had estimated earnings of 63 cents a share. Sales rose 21 percent to $5.26 billion, beating expectations.

Apple sold 10.5 million iPods and 1.52 million Macs in the quarter ended March 31, boosted by demand for notebook computers and the low-cost iPod Shuffle. Falling prices for memory chips and screens increased the company's profit margin. In a separate statement, Apple's board expressed confidence in Chief Executive Officer Steve Jobs amid a government probe into stock options.

``The numbers were pretty unbelievable,'' said Chris Armbruster, an analyst at Al Frank Asset Management in Laguna Beach, California. The firm manages about $900 million and owns Apple shares. ``The biggest thing that jumps out at me was their gross margin.''

Gross margin, the percentage of sales left after excluding production costs, widened to 35.1 percent in the quarter from 29.8 percent a year earlier. Most analysts expected 30 percent, said Shaw Wu at American Technology Research in San Francisco.

Shares Jump

Apple shares rose $6.05 to $101.40 in extended trading after the results were released. If the stock makes a similar gain tomorrow in regular trading, it will be the first time it has climbed above $100. The stock advanced $2.11 to $95.35 at 4 p.m. New York time in Nasdaq Stock Market trading.