Surging iPhone sales spur Apple

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San Francisco, October 22: : cent of Apple's sales in the September quarter, according to the company.

CONSERVATIVE ESTIMATES

For the holiday quarter ending in December, Apple forecast profit between $1.06 and $1.35 a share on revenue of $9 billion to $10 billion. Analysts, on average, were expecting earnings of $1.69 per share on revenue of $10.7 billion in the period, according to Reuters Estimates.

Gabelli & Co analyst Robert Haley said the company forecast is "traditionally conservative, and with the economy being a big wild card they're being more conservative."

In the September quarter, Mac shipments increased 21 per cent from last year to 2.61 million, while iPod shipments rose 8 per cent to 11.05 million.

Some fear that Apple may be more susceptible to an economic downturn because it charges premium prices for its products. But Jobs said the company has no interest in going down-market, and he scoffed at so-called netbooks, which are stripped-down, budget laptops.

"There are some customers which we choose not to serve. We don't know how to make a $500 computer that's not a piece of junk," he said.

Jobs also gave clues to the company's approach as it enters what may be an extended period of economic uncertainty.

"We have almost $25 billion safely in the bank and zero debt. This provides us tremendous stability and the ability to invest our way through this downturn. This is what we did during the last downturn."