Speculation over health of Jobs and profits hits Apple shares

by Staff, Brand Republic 22-Jul-08, 14:10

SAN FRANCISCO - Apple shares are down 10% in pre-market opening trading after the iPod manufacturer projected a drop in sales and profit growth for the last quarter of its fiscal year and questions resurfaced about chief executive Steve Jobs' health.

Apple forecast that revenues this quarter would hit $7.8bn, which was $500m below analysts' expectations. The period is typically strong due to back-to-school sales.

Its shares are currently down $16.14 to $150.15 in trading before the opening of the Nasdaq market in the US today.

The fall came despite Apple reporting its strongest third quarter results to date.

Apple's revenues for the quarter ending June 28 jumped 38% to $7.46bn (£3.7bn) and post-tax profits rose 31% to $1.07bn on the back of strong sales of its Macintosh computers, iPods, and iPhones.

The company sold a record 2.5m Macs during the three month-period, 11m iPod media players and 717,000 iPhones.

Steve Jobs, Apple chief executive, said: "We're proud to report the best June quarter for both revenue and earnings in Apple's history.

"We set a new record for Mac sales, we think we have a real winner with our new iPhone 3G, and we're busy finishing several more wonderful new products to launch in the coming months."

However, speculation is rising about the health of Jobs, who unusually failed to attend the group's conference call to discuss the quarterly earnings.

Jobs was treated for pancreatic cancer in 2004 and concerns about his health arose at the company's annual developers' conference last month when he appeared looking gaunt.

Peter Oppenheimer, chief financial officer of Apple, said during a conference call with media and analysts yesterday: "[Steve] has no plans to leave Apple. Steve's health is a private matter."