January 12, 2008 in Business

Jobs hard-pressed to top ‘Macworld of Macworlds’

Associated Press The Spokesman-Review
 
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A MacWorld Conference & Expo attendee checks out the Apple TV in San Francisco during last year’s Macworld Conference. Apple’s stock has doubled since the 2007 event. Associated Press
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SAN JOSE, Calif. – Steve Jobs has a tough act to follow at the Macworld Conference & Expo on Tuesday: himself.

At last year’s trade show, Apple Inc.’s charismatic CEO hurtled into the cell phone industry with the iPhone, jettisoned the word “computer” from the Macintosh maker’s name and launched the Apple TV set-top box.

Since then, Apple’s stock has doubled, its computer market share has grown and consumers have continued their love affair with iPod media players.

This year’s announcements aren’t likely to dazzle like last year’s. Jobs is expected to take the wraps off a movie rental service, show off an ultra-portable laptop and maybe give the iPhone a faster connection to the Net.

“All I can say for certain is that Macworld 2008 is not going to top 2007. That was the Macworld of Macworlds,” said Charlie Wolf, analyst at Needham & Co.

Still, Apple is expected to boom on. It has targeted sales of 10 million iPhones by the end of 2008, meaning the handset that combines the functions of an iPod, cell phone and wireless Web browser could account for roughly 1 percent of cell phones expected to be sold worldwide this year.

There is little doubt among observers – even its competitors – it can reach that goal.

Sales of the iPod, meanwhile, are still growing, though not as fast as before. Analysts expect Apple to post record sales again this year despite concerns of an overall slowdown in consumer spending. Wall Street predicts Apple will earn $5.09 per share for its fiscal 2008, up nearly 30 percent from $3.93 per share last year, on annual sales that will grow 32 percent to $31.7 billion, according to a poll of analysts by Thomson Financial.

In fact, Apple outpaced the overall PC industry last year. In its last quarterly report, for the period ending in September, the company sold 2.16 million Macs, up 34 percent from the year earlier and more than double the worldwide PC growth rate of 15.5 percent, according to IDC.

A halo effect from iPods has helped. Since the iPod debuted in 2001, more than 119 million have been sold, helping to propel Apple’s market capitalization from $6 billion to $155 billion.

Likewise, analysts believe the iPhone will help lure newcomers to the Mac platform. Apple’s share of the PC market in the U.S. grew to 7.6 percent in the fall of 2007 from 6 percent the year before, according to Gartner Inc.

Many Wall Street analysts expect Apple’s stock, which closed Thursday at $178.02, to surpass $200 in 2008.

It’s not that Apple can’t go wrong. It’s just that its recent streak of innovation and business execution has overshadowed hiccups along the way.

Apple found itself in the uncommon situation a few times last year of placating angry iPhone customers after it slashed the product’s price and insisted on barring third-party programs from running on the handset, for instance. Apple has since vowed to open the device to third-party developers but hasn’t said how it will do so.

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