Sour bite to Apple profits

NEWS WIRE SERVICES

Thursday, April 24th 2008, 4:00 AM

Apple's profits jumped 36% on blistering sales of Macintosh computers, but its stock dropped on the company's forecast of earnings that will fail to meet earlier expectations.

The Mac and iPod maker is believed to be especially vulnerable to slowing consumer spending in the United States because of its stronger presence here than overseas.

Another factor weighing on Apple during the second and third quarters is the company's decision to delay recognizing iPhone sales until a software upgrade for the multimedia gadget is shipped this summer.

Apple shares fell 58 cents to $162.31 in after-hours trading, climbing back from a dip of nearly 5% right after the close of trading and the release of the earnings report. Shares had closed up $2.69 to $162.89 in regular trading.

The report showed that Apple was firing on all cylinders during the first three months of the year.

The iPhone and iPod maker had net income of $1.05 billion after winning customers for its Macintosh personal computers. Revenues jumped 43% in the period to $7.51 billion

Apple sold 2.29 million Macs, spurred by demand for notebooks such as the ultra-thin MacBook Air, unveiled by CEO Steve Jobs in January.

The Mac accounts for about a third of sales. Apple posted a 33% jump in U.S. shipments last quarter, the biggest gain among the top PC makers, according to Gartner.

Meantime, Internet retailer Amazon.com said profits rose 29% to $143 million, helped by solid sales in the U.S. and abroad.

Revenues increased 37% to $4.14 billion.

But a disappointing operating income outlook for the year pushed shares down $3.59, or 4.4%, to $77.41 in after-hours trading.

The stock had gained $1.40 in regular trading.

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