The problems facing Apple continued to mount when the company was buffeted this week by news that U.S. sales on a year-to-year basis are falling faster than expected.
According to the market research company Computer Intelligence Info, in Mountain View, California, Apple's sales in April and May dropped by more than 30% for each month when compared with the same months last year. Although the declines were expected, they were larger than most analysts had predicted.
Apple appears unfazed by the report, however, and the company is pointing to a stream of announcements by its CEO and chairman, Gil Amelio, that the company will not return to profitability until fiscal 1997.
In May, Amelio said Apple would need to restructure its costs so that the company's break-even point would be about US$9 billion a year. At the time, Apple's break-even point was US$12 billion. An Apple representative says the company remains on track to meet its goals. Some observers say the decline in unit sales is in line with their projections, although Pieter Hartsook, publisher of the Macintosh- oriented Hartsook Report newsletter, says a more worrisome problem is that Apple has failed to introduce any significant new products over the course of the year.
"It is inundated with bad news, and there hasn't been any revolutionary new technology to counteract that," Hartsook says.