Apple profits quadruple on iPod surge

Apple Computer yesterday demonstrated its status as one of the most desirable brands on the high street when it said quarterly profits more than quadrupled and sales of iPods and computers soared in the run-up to Christmas.

Apple Computer yesterday demonstrated its status as one of the most desirable brands on the high street when it said quarterly profits more than quadrupled and sales of iPods and computers soared in the run-up to Christmas.

Apple, based in Cupertino, California, said net income for its fiscal first quarter, which ended on 25 December, rose to $295m (£156m), or 70 cents a share, from $63m, or 17 cents a share, a year ago. Sales rose 74 per cent to $3.49bn.

The figures exceeded analysts' expectations, already bullish due to the popularity of Apple's portable music players, iPods and computers.

Analysts had expected $3.18bn of sales, or 40 cents a share, but Apple appeared to exceed its own expectations. In October it said sales would be between $2.8bn and $2.9bn.

The record results came after Apple announced on Tuesday a dramatic development in its strategy for 2005. Steve Jobs, the chief executive and founder, said the company would launch a basic version of its computer for just short of $500 to bring the luxury computer company within the reach of the mass market.

Apple will also roll out a cheaper version of the iPod, which will be the size of a stick of chewing gum and cost about $99. Apple said it had shipped 4.58 million iPods in the first quarter, which included Christmas, compared with 2 million in the fourth quarter. In the three months leading up to Christmas it shipped 337,000 of its top-of-the-range iBook laptops.

Its shares climbed to $74 in after-hours trading from their Nasdaq close of $65.46. For its fiscal second quarter, it forecast revenue of $2.9bn and earnings of 40 cents a share.

iPods have fuelled a spurt of growth in Apple's sales, bringing more customers into its shops and leading to more sales of laptops and computers.