Massive losses for Apple in 2nd quarter

Massive losses for Apple in 2nd quarter

Gilbert Amelio, chairman and CEO of Apple Computer, says Apple expects to lose $US700 million in the second quarter.

Apple is suffering from an industry-wide slowdown in PC sales, a miscalculation of demand that led to the remaining inventory of last year's products and speculation late last year of a takeover. More than half of Apple's loss will go to writing down inventory, and about a quarter will go to restructuring charges, including charges for laying off 1,300 of its 14,500 employees, according to Apple.

Most analysts think that by declaring big losses now, Apple is cleaning its slate in order to clear the way for Amelio.

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