Election Section

CUPERTINO — Apple Computer Inc. reported a 61 percent drop in fourth-quarter profits Wednesday, beating Wall Street’s expectations. But the company warned of a shortfall in profits and revenues in its fiscal first quarter. 

Shares of Apple fell $1.02, or 5.6 percent, to $16.99 on the Nasdaq Stock Market ahead of the report. The stock was off 35 cents in after-hours trading. 

For the three months ended Sept. 29, the Cupertino-based company reported net income of $66 million, or 19 cents per share — compared with $170 million, or 47 cents a share, in the year-ago quarter. 

Excluding a one-time investment gain, the company earned $65 million, or 18 cents per share. Wall Street analysts surveyed by Thomson Financial/First Call predicted earnings of 16 cents per share. 

Revenue for the quarter reached $1.45 billion, down 22 percent from the year-ago period. 

Revenue in the first quarter is expected to be flat at about $1.4 billion and earnings per share are now expected to fall to 10 cents per share, Apple said. Thomson Financial/First Call estimates were for earnings of 18 cents per share on revenue of $1.6 billion. 

For the year, Apple reported losing $25 million on revenues of $5.36 billion. In 2000, the company earned $786 million, or $2.18 per share, on revenues of $7.98 billion. 

Seeing no upturn in the slumping personal computer market, Apple officials in July lowered their fiscal year revenue expectations to about $3 billion from a range of $3.2 billion to $3.4 billion. 

The personal computer has been struggling with the economic slowdown. Market researcher International Data Corp. has lowered its annual forecasts several times this year and predicts global shipments of PCs to decline in 2001 by 1.6 percent to about 130 million units. A recovery isn’t expected until 2003. 

Despite the industry’s gloomy performance, Apple is forging ahead with product rollouts and upgrades. Tuesday, the company beefed up its iBook and PowerBook G4 mobile laptops, adding faster processors, bigger hard drives and wireless networking features. The company kept prices the same. 

Next week, Apple said it will announce a new digital device — “not a Mac” — but won’t give any more details. 

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On the Net: 

http://www.apple.com