Varied reaction to Apple, Yahoo gains

Revenue grew 49% and 1%, respectively

It was a new-media mixed bag Tuesday as far as Wall Street was concerned, with Apple impressing and Yahoo disappointing, though mildly.

Apple grew its net income 90% to $3.1 billion during its fiscal second quarter as it sold 9 million iPhones, more than twice as many as a year ago, and 3 million Mac computers, up 33% compared with last year. IPod sales, though, dipped 1% to 11 million.

Revenue for Apple rose 49% to $13.5 billion; analysts expected only $12 billion. Apple shares, down 1% to $244.59 during the regular session, jumped 6% after hours, eclipsing an all-time high.

During a conference call Tuesday, analysts sought intelligence on how popular the iPad is. Apple COO Tim Cook said that sales outpaced Apple's own lofty expectations. He praised the device as a game-changing "new category" in part because of the way it embraces movies and TV shows better than any other mobile device.

In the future, Apple intends on sharing iPad sales numbers the same way it does iPhones and other products. Not so with Apple TV, though, which Cook said remains classified "as a hobby for the company."

At the closing bell, Apple's market cap stood at $222 billion, higher than Google and even NBC Universal parent General Electric. In fact, Wall Street values Apple more than it does Disney, Time Warner, News Corp., Viacom, CBS and Sony combined.

Wall Street didn't view Yahoo's results as favorably Tuesday. Its shares lost a penny during the regular session to $18.38 and slid another 3% during the after-hours session, when investors got a look at its first-quarter earnings release.

Yahoo's net income soared 162% to $119 million on revenue up 1% to $1.6 billion, a mild quarterly gain but its first in nearly two years. The results were boosted by $78 million owing to reimbursements from Microsoft, which has a search agreement with Yahoo.

In a hopeful sign of a rebounding economy, Yahoo's display-advertising segment grew 20% year-over-year.

"Large advertisers came back," CEO Carol Bartz said. She and CFO Tim Morse indicated that the search market for Yahoo might have bottomed, and its market share is expected to trend higher.
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