Apple back in the black

IT MAY be tempting fate to say this but, after three long years, Apple Computer is no longer on the critical list.

Last week Steve Jobs, Apple's chief executive, announced the company's latest financial results which showed that, for the fourth quarter in a row, the company had beaten Wall Street's expectations, making a fourth- quarter profit of $106m, which brought its total profit for the year to $309m. That compares with total losses of almost $2bn over the previous two years.

Jobs came up with lots of other impressive figures, as well. The iMac, Apple's new consumer computer, has sold 278,000 units since its US launch six weeks ago. The success of this one item produced a 28 per cent increase in Apple's sales compared with the previous quarter.

That figure is particularly important, as Jobs claims that Apple has finally begun to reverse the decline in sales that it has experienced over the last two years.

Apple has also been analysing the sales figures for the iMac and has revealed that more than 30 per cent of iMac sales have been to home users who were buying their first computer.

The iMac even managed to grab a few sales from Windows PCs, with 12.5 per cent of iMacs being sold to people who were replacing an old PC. For the past few years Apple has survived only by clinging desperately to its die-hard users, but the iMac has started to attract the new users that Apple needs to ensure its future growth. Apple's next big step is this week's release of OS8.5, a major upgrade to its Macintosh operating system.

Jobs described OS8.5 as "our biggest software release in years". It includes dozens of new features, such as Sherlock, an intelligent searching system that can scan a computer's hard disk and summarise the content of all its files in plain English. It can also send search inquiries to Internet search engines such as Yahoo! and Excite without the need for a Web browser.

Fred Anderson, Apple's chief financial officer, predicted strong sales for both the iMac and the Mac OS8.5 over the coming months and claimed that these products would help to ensure Apple's continued growth in 1999. Amid all this good news, Steve Jobs even found time for a quick mention of the United Kingdom. We are, it seems, "a very important market for Apple".

Unfortunately, Apple UK has never had much of a presence in High-Street chains such as Dixons and Currys, which is where the iMac needs to be seen in order to attract sales from UK consumers.

However, Apple UK has now signed agreements with Dixons, Currys and PC World, and is conducting trial sales through a limited number of Tesco stores.

This winter will be an important test for Apple, and it will have to work hard to ensure that the iMac continues to sell well over the Christmas buying period.

Apple's recovery may not yet be complete but, as Jobs himself has said: "Today, at least, we can stop and smell the roses".