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Apple 3rd-Quarter Profit Jumps 65%; NCR Reports a Record Net

July 14, 1987|VICTOR F. ZONANA | Times Staff Writer

SAN FRANCISCO — Paced by strong demand for its Macintosh line of personal computers, Apple Computer on Monday reported that its third-quarter profit jumped 65% on a 42% increase in sales.

Apple's better-than-expected performance, coupled with the announcement of record second-quarter earnings at NCR Corp., sent computer stocks, including IBM, soaring across the board. Apple's stock gained $2.50 to close at $40.50 in over-the-counter trading, while NCR was up $1.75 to $75.125.

Cupertino-based Apple's net income in its third quarter, which ended June 26, jumped to $53.5 million from $32.3 million a year earlier. Sales reached a record $637.1 million, up from $448.3 million a year earlier.

"Apple has entered a new phase," said Chairman and Chief Executive John Sculley. "The investments we've made are yielding good growth in both revenues and earnings."

Macintosh momentum is building worldwide, he said, while the venerable Apple II line continues to experience "healthy demand" in the education market.

Michael Murphy, editor of the San Francisco-based California Technology Stock Letter, said Apple is benefiting from the introduction of such computer models as the Macintosh SE and the high-performance Macintosh II.

"Both new machines have caught on," Murphy said, noting that the Mac II is "very hard to get." High-volume shipments should begin in September, he said.

"Apple clearly is headed for a good year, with strong momentum going into next year."

In the first nine months of its fiscal year, Apple's profit climbed to $145.8 million from $121.1 million last year. Sales increased to $1.87 billion from $1.39 billion.

NCR, based in Dayton, Ohio, posted record second-quarter net income of $98.6 million, up 25% from $78.8 million a year earlier. Revenue climbed 16% to $1.36 billion from $1.17 billion last year.

European and Asian sales paced the advance, although sales in the United States also grew, said Charles E. Exley Jr., NCR chairman and president.

Part of the overseas gains reflected the weakness of the dollar, as sales in foreign currencies had an increased value in dollars.

Personal computers and supermicrocomputers experienced strong gains.

"These results support our expectations of record earnings and revenue for 1987," Exley said.

For the first half of its fiscal year, NCR's net income totaled $160.2 million, compared to $129.1 million a year ago. Sales were $2.48 billion, up from $2.13 billion a year earlier.

Other earnings, Page 2

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