Apple's Net Income Falls Nearly 70% In 3QApple's Net Income Falls Nearly 70% In 3Q

Apple Computer Tuesday reported a near-70% drop in third-quarter profits and warned that next quarter wouldn't be much better, as a back-to-school bounce seems unlikely to materialize.

Apple reported net income fell 69.5% to $61 million, or 17 cents per share, for the quarter ended June 30, compared with $200 million, or 55 cents per share, during the comparable quarter one year ago. Revenue fell about 19%, to $1.48 billion, compared with $1.83 billion last year. The company blamed the soft economy and business customers' delay of hardware purchases until more application software for Apple's new Mac OS X becomes available later this year.

"We haven't seen any signs of an upturn in the consumer PC market," said Apple CFO Fred Anderson during a conference call with reporters and analysts. "Usually, you see a little bit of an upturn around the back-to-school season. We think it's safe not to count on that this year."

Anderson says sales and earnings per share during the fourth quarter ending Sept. 30 will be only slightly above third-quarter levels. During the fourth quarter of 2000, Apple earned 45 cents per share.

Apple shipped 827,000 Macintosh computers--46% of them portables--to retailers during the most recent quarter, including two new company-owned stores in California and Virginia. Apple says it sold about $1.25 billion of hardware to customers and is reducing its channel inventory. CEO Steve Jobs is set to address the company's semiannual Macworld Expo convention in New York Wednesday.