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Apple's Bubble Bursts, Show Q4 Loss

10/17/2002 08:22:00 AM Eastern

Cupertino, Calif. - Putting the blame on several one-time charges, Apple Computer recorded a $45 million net loss in its fiscal fourth quarter, its first negative net in nearly two years. In the same quarter in 2001, Apple registered a net profit of $66 million.

Revenue for the fourth quarter, ended Sept. 28, was flat compared with the year-ago three months. Net sales dipped from $1.44 billion in the fourth quarter this year, down from $1.45 billion in the year-ago period.

Gross margin also dropped in the fourth quarter, dropping 370 basis points, to 26.4 percent, compared with 30.1 percent a year ago.

Excluding one-time items - such as a write-down of certain equity investments totaling $49 million net of tax, a $4 million restructuring charge and a $1 research and development charge - Apple net profit for the fourth quarter would have been $7 million, said the company.

Apple said it shipped 734,000 Macintosh computers during the three months, down 14 percent from the 850,000 shipped in the same period last year. Its iPod digital music player, introduced about a year ago, shipped 140,000 units in the three months.

Sales in the company's retail stores climbed to $102 million in the fourth quarter, up from $63 million in the same three months in 2001.

For the 12 months, Apple registered net income of $65 million, up from a loss of $25 million the previous year. Revenue for the 12 months hit $5.7 billion, compared with $5.4 billion year over year.

'Looking forward, we do not expect our industry to pick up anytime soon,' said Steve Jobs, CEO, 'though we're hoping to help put a lot of iPods, iMacs and iBooks under trees this holiday selling season.'

In the first quarter of 2003, Apple expects revenue to be up slightly from the fourth quarter of 2002, said Fred Anderson, chief financial officer. He does anticipate a slight profit for the first quarter before non-recurring items.