Apple Puts Intel Inside

Updated from 2:22 p.m. EST

SAN FRANCISCO -- As has been rumored for months, Apple Computer(AAPL Quote - Cramer on AAPL - Stock Picks) is starting its transition to Intel(INTC Quote - Cramer on INTC - Stock Picks) chips early, CEO Steve Jobs announced Tuesday at the company's MacWorld conference here.

While the Mac faithful cheered the development, it remains to be seen whether Wall Street will be similarly joyful as the event euphoria fades. Contrary to other rumors, Jobs didn't introduce any all-new products or update the company's iPod line.

Of course, investors already had plenty to be happy about on Tuesday: Apple said it posted $5.7 billion in sales in the holiday period and sold a whopping 14 million iPods in the period. That's a far higher iPod tally than many analysts were expecting and dwarfs the 4.5 million the company sold in the holiday period last year. Analysts polled by Thomson First Call, meanwhile, were expecting the company to post sales of $5.04 billion in the period.

Shares of Apple were recently up $4.38, or 5.8%, to $80.43; earlier in the session, shares set a new 52-week intraday high at $81.89.

The computers getting the Intel treatment are the company's iMac line of consumer desktops and its professional line of notebook computers, formerly the PowerBook, which has been rebranded as the MacBook Pro. While the new Intel-based iMacs are available immediately, the MacBooks won't be available until next month.

The new Intel-based systems come some five months before Apple had promised. Jobs announced last summer that by June of this year the company would introduce Macintosh computers with Intel chips instead of PowerPC processors, which have powered Apple machines for more than 10 years.

"We started our partnership [with Intel] a year ago. The teams worked hard to make this happen in record time," Jobs said, while joined on stage by Intel CEO Paul Otellini, dressed in one of his company's famous chipmaking bunny suits.

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