Apple shares down as revenues faces challenges

Shares in Apple Computer fell 1 percent in after hours trading Wednesday in spite of a report saying that Apple had experienced a more than six-fold earnings increase on the strength of the company’s success with its iPod music player.

Apple sold 5.3 million iPods and 1.07 million computers last quarter.

That was a 558 percent increase in iPod sales, on the strength of the release of the iPod Shuffle, and a 43 percent increase in computer sales due to the introduction of the low-cost Mac mini computer in the quarter.

The decrease in share value despite this good news had to do with investor disappointment at news that current-quarter revenues would not meet the highest estimates of Wall Street.

Reports were that Apple expects current-quarter revenues of $3.25 billion and earnings of approximately 28 cents per share, while Wall Street forecasts were for sales of $3.2 billion and a profit of 24 cents per share. But some analysts had expected even higher performance.

There was also a concern that with Apple’s introduction of low-end products, average selling prices will fall.

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