October 22, 2007 4:00 AM PDT

Apple set to report fruits of busy summer

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Another item worthy of attention will be the iTunes Store, which this summer has seen some increased competition--both from other stores like Amazon.com and from the producers of the content themselves. Revenue from the store doesn't contribute nearly as much to Apple's bottom line as the sale of its hardware, but it's still indicative of what people are doing with their iPods and the broader trends for online purchases of digital music and video.

Investors ran up Apple's stock in the week before the announcement, ending the week at $170.42, less than $4 off the company's 52-week high. Apple investors tend to stick with a buy-on-the-rumor, sell-on-the-news strategy, so don't be surprised to see Apple's stock fall next week if the company beats its own targets but misses one of Wall Street's targets for a certain segment.

Last quarter, Apple Chief Financial Officer Peter Oppenheimer warned the financial community not to expect a duplication of the company's second-quarter earnings per share figure of 92 cents a share. To introduce the new iPods, Apple had to clear inventory of older models, which tends to drag down gross margins to some degree.

Oppenheimer also warned of higher component costs and an "expensive" back-to-school promotion, which could have been the iPhone price cut but was more likely the free iPod that student buyers could receive along with the purchase of a new MacBook or MacBook Pro.

Still, Apple is likely to report another very solid quarter to close out its financial year. For the full year, Apple is expected to post revenue of $23.9 billion and earnings per share of $3.78, increases of 24 percent and 67 percent, respectively, and all-time highs.

For any company not named Google, that's an enviable financial picture.

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Unlocked iPhone to be available in France.
Switzerland's "SonntagsZeitung" reported Sunday (Oct. 20) that iPhones sold in France through Orange would have to comply with consumer's rights laws of France by suppling in addition to the "locked" Orange version an "unlocked" version which would allow cell phone subscribers to use the cell phone provider of their choice. This "Naked iPhone" comes at a price though as it's expected to cost over $1,200.
Posted by imacpwr (456 comments )
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Nice... very nice.
For a "niche" company, that sells little-to-no servers at all, to rank 3rd, just behind two companies that make a very hefty portion of their income from selling servers? Very nice.

Posted by Penguinisto (5042 comments )
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makes most of its money from...
things that have nothing to do with computers
Posted by pfletcher (88 comments )
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Why rain on the parade?
Even as Apple performs better than it has in more than a
decade, Tom Krazit cannot resist anticipating its failure. When it
comes to that company, he is given to schadenfreude.
Posted by J.G. (837 comments )
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mainly because
they run a tightrope act and eventually they will run out of gullibles who will accept paying a high price for coolness - it already started with the iPhone
Posted by pfletcher (88 comments )
Link Flag
For the ordinary Chinese people
The ordinary Chinese people also seem to enjoy the benefits, consider the cities of second class, a city the pursuit of fashion.
Posted by xxczxd (10 comments )
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