Strong sales of Apple Macs seen offsetting slowing iPods|
The growth of iPod sales is slowing but Apple Computer Inc. may surprise investors with strength from its original business -- computers -- when it posts quarterly results on Wednesday.
Apple completed the transition of its computer line to Intel Corp. microchips in August, when it introduced its professional desktop Mac Pro and Xserve products and is poised for further market share gains in the computer market, analysts said.
With more than 75 percent of the U.S. market for digital music players, there's limited room for growth in iPod market share. But there is plenty of room to boost Apple's original business, selling the Macintosh computers known for their industrial design and included package of media software.
"We see continued strength in the Mac business, which was very strong last quarter," said American Technology Research analyst Shaw Wu. "The transition to Intel has definitely been smoother than investors' expectations and is now complete."
Overall, Wall Street analysts expect Apple to earn 51 cents per share, on average, within a range of 49 cents to 55 cents, on revenue of $4.66 billion, according to Reuters Estimates.
In the year-ago quarter, Apple had net income of 50 cents per share and revenue of $3.68 billion.
UBS analyst Ben Reitzes expects Apple to ship 8.12 million iPods in its fiscal fourth quarter, which would be an increase of 26 percent from a year ago, he wrote in an October 12 report. In the previous quarter, iPod shipments rose 32 percent year over year.
He expects Apple to have shipped 1.48 million Macs, representing 20 percent growth from a year ago and 11 percent higher than the previous quarter.
"Our checks continue to show solid demand for Macs, particularly the new MacBooks," Reitzes wrote, referring Apple's notebook PC.
Apple said in July, when it last reported results, that it had doubled its share of the U.S. retail notebook market to 12 percent as measured by units shipped from January to June.
It said then it expected fourth-quarter net earnings per share of about 46 cents to 48 cents, including an estimated three cents per share expense from non-cash stock-based compensation. It also said it expected revenue of $4.5 billion to $4.6 billion.
Wu said that while he expects iPod sales to pickup somewhat in the quarter to be reported on Wednesday, they should accelerate further in the December quarter, aided by shipments of its recently announced Shuffle digital music player.
"We don't see a full rebound until the December quarter when we see much higher volumes of the recently announced Shuffle," Wu said.
Merrill Lynch analyst Richard Farmer wrote in an October 13 note that he expects Mac unit shipments of 1.51 million in the fourth quarter, up from his previous estimate of 1.44 million units, citing a "broader thematic shift in the story away from iPods toward an emphasis on Macs and 2007 new product cycles."
Farmer cited "better-than-expected demand for new MacBooks" for the increase in his estimated Mac shipments. UBS's Reitzes wrote that he expects MacBook Pro notebook computers with Intel Core 2 Duo processors available in time for the holidays.
While Apple is scheduled to report results on Wednesday, the Cupertino, California-based company might not release full financial results due to an internal stock option grant investigation, Wu said.
"Should they announce full financials, that would definitely be viewed as positive," Wu said.
An Apple spokesman declined to comment.
Apple said on October 4 that an internal investigation found irregularities with its past stock option grants and announced the immediate resignation of a former chief financial officer from its board of directors.
The company also said that Chief Executive Steve Jobs was aware of some of the stock option grants, but he did not benefit from those grants and was unaware of the accounting implications.
Apple said then it would likely need to restate its past financial statements, but was unable to determine the details of the restatements or the size of the likely charges it would take.
Shares of Apple rose 38 cents to close at $75.40. Since the company last reported quarterly results in mid-July, its shares have gained 25 percent.
IBM enters video surveillance software market|
IBM said on Tuesday it has started selling security software that analyzes data from video surveillance cameras in real time, generating instant alerts of potential security breeches.
XenSource To Ship Windows, Linux Platform Next Month
Just a day before market leader VMware kicks off its annual conference, XenSource on Monday unveiled release plans and sub-$1,000 pricing for its much-anticipated virtualization platform for Windows and Linux.
Tendo Announces Redesign of Web Site
TDCI Partners with Scene7 to Deliver Rich Media Applications
TDCI Inc, a leading enterprise solution provider, today announced that the company is partnering with Scene7, Inc., provider of the industry-leading Scene7 On-Demand rich media platform, to deliver several new capabilities within TDCI's BuyDesign guided selling and configuration solution. BuyDesign is a comprehensive software solution that helps companies increase sales and improve profitability by enabling them to become 'easy to do business with' while reducing order processing time, cost, and errors.
Remote Backup Systems to Showcase Industry-leading Online Backup Software at ISPCON
Remote Backup Systems, Inc. (RBS), developer and distributor of RBackup online backup software on the web today announced that it will showcase its industry-leading RBackup product at a conference dedicated to Internet Service Providers (ISPs) this week.
David's Domains Offers Web Site Builder for .MOBI Helping .MOBI Owners Build Mobile Web Sites
David's Domains a provider of Domains and Web Hosting services, offers the popular WebSite Tonight product, providing key features for those yearning to get involved in the .MOBI revolution.
How Red Hat Does Support
Oracle, with its recent claims to be able to support Red Hat Enterprise Linux under the name Unbreakable Linux better than Red Hat does, has a hard road ahead of it. Behind Red Hat's support network is a large, well-trained organization.
Open Season on Closed Platforms at Web 2.0
Among the many buzzwords associated with the Web 2.0 hype, none has quite the cachet as "open." Yet no idea is more profoundly troubling to the companies trying to build profitable Internet businesses.
Punch! Software Acquires CADSoft Solutions, Inc.
Punch! Software, the home design software market leader seven years running, today announced the acquisition of CADSoft Solutions Inc. CSI is a leading provider of precision based computer aided design applications for Windows® and Macintosh platforms.
CA To Deliver Software For Microsoft Exchange Server 2007
CA announced that it will deliver information, recovery, and resource management products for data protection, e-mail archiving, compliance, and electronic data discovery for Microsoft Exchange Server 2007.