Weak Forecast Takes a Bite From Apple

The company blows away earnings estimates, but its traditionally light guidance may have come up too short.
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SAN FRANCISCO -- Apple (AAPL) - Get Report blew past Wall Street's third-quarter expectations but the company's standard conservative guidance for the current quarter appeared to disappoint investors.

Shares of Apple were off $7.70, or 4.6%, to $158.59 in recent after-hours trading.

The company said Monday that it earned $1.07 billion, or $1.19 a share, in the third quarter, compared with profit of $818 million, or 92 cents a share, a year earlier.

Revenue rose to $7.46 billion from $5.41 billion a year ago.

Analysts polled by

Thomson Reuters

were expecting earnings of $1.08 a share on revenue of $7.36 billion.

Gross margin fell to 34.8% in the third quarter, down from 36.9% a year ago.

For the fourth quarter, Apple offered its traditional conservative guidance and then some, saying it expects revenue of $7.8 billion and earnings of $1 a share. Analysts were expecting revenue of $8.32 billion and earnings of $1.24 a share.

In the third quarter, international sales accounted for 42% of the quarter's revenue.

About 11 million iPods were sold in the quarter representing 7% revenue growth from a year ago, but just 2% unit growth. Analysts' expectations ranged from 10.25 to 10.5 million devices.

Apple shipped 2.49 million Macs, posting a 43% revenue growth from the year-before and 41% unit growth. Analysts' expectations had ranged from 2.4 million to 2.5 million Macs.

Quarterly iPhone sales came in at 717,000 devices, said Apple, and compared 270,000 iPhones sold in the year-ago-quarter.

The quarter's results don't include the company's latest iPhone 3G device. Apple has said that it sold 1 million iPhone 3Gs in the three days since the device's launch on July 11.

Apple's iPhone competes with BlackBerry maker

Research In Motion

(RIMM)

, handset makers

Motorola

(MOT)

,

Nokia

(NOK) - Get Report

and

Palm

(PALM)

among others.

Apple's strong results are in contrast to the soft numbers reported by tech giant

Google

(GOOG) - Get Report

last week and the weak outlook offered by

Microsoft

(MSFT) - Get Report

.