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Apple beats expectations for busy holiday quarter

Nancy Gohring | Jan. 22, 2009
Apple beat expectations with its financial results for the holiday shopping quarter

That doesn't mean Apple plans to alter its basic strategy with the phone. "We're not going to play in the low-end voice phone business," Cook said. "We'll let somebody else do that. Our objective is not to be the unit share leader in cell phones, it's to build the world's best phone."

Cook said that Apple is keeping a close eye on competitors that are trying to emulate the iPhone. "We like competition, as long as they don't rip off our IP," he said. He would not name specific companies that might be mimicking Apple's technology, but he spoke in response to a question about Palm's Pre. Set to hit the market in the first half of this year, the Pre will feature a multitouch screen, much like the iPhone.

Apple said it expects continued success despite the ailing economy. For its second quarter of fiscal 2009, Apple expects revenue between $7.6 billion and $8 billion and earnings per share of $.90 to $1.00.

Apple executives did not offer additional details about Jobs' health and only one analyst on the conference call asked questions about it. "Steve is CEO of Apple and plans to remain involved in major strategic decisions, and Tim will be responsible for day-to-day" operations, Peter Oppenheimer, Apple's CFO, said during the call, referring to Cook.

A week ago Jobs disclosed in a letter to employees that health issues required him to take a leave of absence until the end of June. The announcement came a little over a week after he revealed that his gaunt appearance lately, which has been the subject of much speculation, had been caused by a hormone imbalance.

When announcing his leave, Jobs declined to reveal further details about his condition except to say that it was more complex than he originally thought. The setback follows surgery he underwent in 2004 for pancreatic cancer.

Apple's share price tends to rise and fall based on rumors regarding Jobs' health. While many companies have charismatic leaders, Jobs is thought to control even minor decisions at Apple, the company he co-founded in the 1970s and brought back to life after returning to it in the mid-1990s.

"Unfortunately, the curiosity over my personal health continues to be a distraction not only for me and my family, but everyone else at Apple as well," Jobs wrote in his letter to employees last week. "In order to take myself out of the limelight and focus on my health ... I have decided to take a medical leave of absence until the end of June."

The questions about Jobs's health and its impact on Apple's stock price may have drawn the attention of regulators at the U.S. Securities and Exchange Commission. The commission is examining Apple's statements about Jobs's health to determine whether the company misled investors, according to a Bloomberg story published on Wednesday citing unnamed sources. The SEC declined to comment on the report.


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