Apple Draws Strength From Mac

But offsetting these risks is Apple's growing share of the computer market. Mac sales leapt 36% last quarter from a year ago, exceeding most analysts' forecasts and tripling overall industry growth.

This helped lift revenue 21%, despite a growing proportion of sales from cheaper iPod models. Apple's bottom line benefited from falling prices on memory devices for computers and iPods.

As a result, gross margins swelled 5 percentage points to 35% from the same quarter a year earlier.

Computer sales should benefit from several tailwinds, including back-to-school shopping and the release of the Leopard operating system. The new Macs come with souped-up Intel(INTC Quote) processors that enable users to take advantage of enhanced audio-video tools available on Adobe's(ADBE Quote) latest version of its Creative Suite software.

This could spur Mac purchases by graphic artists and general photo enthusiasts.

"I see Apple as a long-term play on the growth in consumption and production of digital-video content," says Fati Naraghi, director of technology and telecom research at Newton Investment Management, a unit of Mellon Financial. Several Newton funds hold Apple shares.

"The amount of video traffic people create and consume will continue to grow as broadband penetration increases across the globe," Naraghi says.

Naraghi expects Mac sales to be strongest outside of the U.S. The iPod has brought Apple into homes across the world, she says, especially in developed European markets where the company is expanding its number of stores.

"Apple's longer-term growth story is predicated on mainstream consumers buying Macs as people get used to the iPod and see Apple stores opening everywhere," Naraghi says.

Though Apple's stock has gotten "ahead of itself" on iPhone expectations, Naraghi believes that the stock is very attractive on a three-to-five-year time horizon, given the trends toward consumers downloading and producing digital music and videos.