Apple shines on strong sales rise: More buoyant results from computer makers

HEALTHY sales of personal computers helped Apple to produce better-than-expected profits in the third quarter, completing a week of buoyant results for US computer manufacturers.

Apple said it shipped more than 200,000 of its new Power Macintosh personal computers and Power Macintosh upgrades in the three months. Sales of its PowerBook 500 series notebooks were also strong, helping total sales figures to reach dollars 2.15bn ( pounds 1.42bn), against dollars 1.86bn last time.

Apple earned dollars 138m, or dollars 59.4m before an extraordinary gain because of a fall in restructuring charges. This compared with a net profit of dollars 10.6m for the same period last year.

Apple's results were helped by cost reductions as operating expenses fell to 21.8 per cent of net sales, compared with 22.4 per cent in the second quarter. It made gross margins equivalent to 26.7 per cent of net sales.

The figures came in the wake of better-than-expected numbers from IBM and Compaq, Apple's main rivals. On Thursday IBM shares soared, as faster-than-expected progress in cost-cutting allowed 'Big Blue' to report profits of dollars 689m for the quarter, far ahead of expectations.

This followed Compaq Computer's second-quarter profits of dollars 210m, which were double the level of a year ago on surging sales of its personal computers.

Compaq shares initially fell on concerns over the large stocks that the group was carrying, but later recovered after it said that a bigger inventory would help to smooth out distribution shortages in some of its fast-moving product lines. Compaq's position was in contrast to that at Apple, which said that its stocks had fallen during the second quarter.

Apple shares rose yesterday morning by more than dollars 2 to dollars 30.375 on Nasdaq.