Apple Computer has announced fourth-quarter earnings of $US106 million, or 68 cents per share, bringing the company its first profitable year in three years.
Apple was expected to see earnings per share of 49 cents for its fourth quarter, which ended Sept. 25, according to analysts polled by First Call.
Apple's revenues for the quarter were $1.6 billion with unit shipments rising to 834,000 units, up 28% year-over-year and ending inventory dropping to $78 million, or six days of inventory, the company said in a statement.
For the same quarter a year ago Apple posted a loss of $161 million, or $1.26 per share, on revenues of $1.6 billion.
For the year, Apple's revenues were $5.9 billion and earnings were $309 million, or $2.10 per share, compared to fiscal 1997 revenues of $7.1 billion and a net loss of $1 billion, or $8.29 per share.
Revenues were down modestly, partly because of the curtailment of Apple's imaging and Newton products, Fred Anderson, chief financial officer, said in a conference call.
The iMac, which has a lower sales price than other Apple computers, brought the average unit sales price down from $2,130 in the third quarter to $1,840, he said. Gross margins, meanwhile, improved to 26.8%, he added.
Sales in all three of Apple's product lines -- the PowerBooks, G3 desktops and iMacs -- were strong, showing growth over the previous quarter, according to Anderson. Also contributing to the quarter's earnings were good marketing and operational improvements, which included the inventory turn cycle reductions, he said.
Apple eliminated unnecessary warehouses, particularly in Europe and established hubs with its suppliers that are close to the factory that enabled the company to better streamline its manufacturing operations, Anderson said.
With the exception of Asia-Pacific, Apple had unit growth in each region with 35% more growth in the Americas, 29% in Europe and 21% in Japan, Anderson said. About 37% of Apple's total revenues came from outside the US, he said.
Meanwhile, cash and short-term investments rose by more than $300 million during the latest quarter, resulting in an $840 million [M] year-over-year increase to $2.3 billion, Anderson said.
Also today, Apple announced that its new operating system upgrade, Mac OS 8.5, will ship worldwide this weekend. The upgrade features Internet search technology and PowerPC-native AppleScript which runs up to five times faster than before, the company said.
Contributing to the results boost was a slew of new Apple customers, with more than 40% of iMac buyers purchasing their first Apple computer, the company said. Of those 12.5% were "converts" who own Windows PCs running on Intel microprocessors, Apple said citing a survey conducted by Audits & Surveys.
Apple shipped 278,000 iMacs in the first six weeks the computer was available, making it the fastest selling Macintosh ever, according to the statement.
Apple also announced that Best Buy will begin selling its computers in the US.
When asked if the company foresees an end to Steve Jobs' interim chief executive officer title, Anderson said: "Hopefully, it's a non-issue, if Steve's still having fun. And obviously he's provided awesome leadership that's brought Apple back from the brink of extinction."
Apple stock yesterday closed down 1.375 to $37.375 on the Nasdaq stock exchange.
Apple, based in Cupertino, California, can be reached t http://www.apple.com/.