Apple set for radical shake-up

Apple Computer was believed yesterday to be poised to announce a radical restructuring plan to cut expenses by shedding product lines and laying off up to one-fifth of its payroll.

Faced with a continuing slide in sales and revenue, Apple was expected to detail the new measures ahead of its annual shareholders' meeting in Cupertino, California, tomorrow. Among products that could be ditched by Apple is its loss-making Newton hand-held computer.

That Apple is being forced to take such steps is an indication of the problems still confronting the company and Gilbert Amelio, its chief executive. Given the task of rescuing Apple a year ago, Mr Amelio is behind on his promised schedule to return the company to profitability.

Apple recently reported a loss of $120m (pounds 74m) for the first quarter ending 27 December, which was considerably deeper than had been predicted on Wall Street. The company has said that revenues for the year ending 27 September will be 20 per cent down on the previous year.