52 million units in line with expectations

"In that context, the first-quarter forecasts are quite encouraging."COMPONENT PRICESKaufman Bros analyst Shaw Wu said lower component prices, such as for processors, memory chips and panels, were helping Apple. It expects margins to be about 30 percent in the second half of the fiscal year.The December quarter is traditionally Apple's strongest, fueled by holiday season sales. Mac computer sales rose 9 percent to 2.52 million units, in line with expectations.Notebook sales climbed 34 percent on a unit basis, while desktop sales fell 25 percent, reflecting the broader market shift to portable computers, Apple said. Mac sales rose 16 percent internationally and 2 percent in the United States.Apple is one of the few PC makers without a netbook offering. Cook called the small, inexpensive computers "inferior" but said Apple is watching the segment.Sales of the iPhone fell considerably from the fiscal fourth quarter, when it was launched, to 4.3 million units Analysts had expected sales of roughly 5 million units.

But over the course of 2008, Apple sold over 13.7 million iPhones, ahead of its 10 million target.SHARES BEATEN DOWNApple's shares have taken something of a beating in recent weeks, buffeted by worries about Jobs' health The U.S. Securities and Exchange Commission is examining Apple's disclosures about Jobs' health, Bloomberg reported.When asked about CEO succession plans, Cook who is overseeing the day-to-day operations while Jobs is on leave called Apple's 35,000 employees "wicked smart" and said regardless of who is in what job, the company's values are entrenched, ensuring its success.Collins Stewart analyst Ashok Kumar said Jobs was irreplaceable but if Apple gets "an operationally oriented CEO, I think the strength of the product pipeline should sustain Apple's financial momentum for the foreseeable future."Apple continues to take market share in computers and smartphones, but with consumer spending expected to be weak at least through2009, expectations are building about the company's product plans.Many analysts hope a new device this year will be a sales catalyst much as the 3G iPhone was in 2008 or that Apple will launch products at lower price points to lure in new customers. But Apple executives said the company is "not going to play in the low end" of the voice industry.The iPhone's rivals include smartphones made by Research in Motion and Palm Inc.When an analyst asked whether Palm's new Pre phone copied the touch-screen interface on the iPhone, Cook said he would not talk about any specific company. However, he said, "We will not stand for having our IP (intellectual property) ripped off, and we'll use whatever weapons we have at our disposal."Shares of the Cupertino, California-based Apple closed up 6 percent at $82.83 on Nasdaq before the results. They rose another 9.4 percent in after-hours trading to $90.70.(Additional reporting by Sinead Carew and Tiffany Wu; editing by Richard Chang, Gary Hill).

LOS ANGELES (Reuters) - Apple Inc and eBay unveiled quarterly earnings on Wednesday, offering a mixed picture amid a broad downturn in the technology industry because of a slowing global economy.Apple beat expectations with first-quarter earnings and gave an outlook that cheered investors, sending its stock higher.In contrast, eBay posted lower fourth-quarter earnings and gave a disappointing forecast for the current quarter.The results cap a tumultuous month for Apple, which is facing increased concern from investors about slumping consumer spending and the company's succession plan with Chief Executive Steve Jobs taking a medical leave of absence until June.COMMENTARY ON APPLE:ASHOK KUMAR, ANALYST, COLLINS STEWART"The trailing quarter is better than expected and the outlook is better than feared, and so it's a relief on multiple fronts."The iPod momentum continues although at a slower pace. But given the macro backdrop I think it's the best we can expect."On the Mac, revenues are flat, year on year, which is a meaningful deceleration but on a unit basis they still continue to outperform the market."But the primary upside continues to be on the margin. I think, relative to the guidance, that continued to generate most of the earnings upside. That should in itself get them some support for the stock."I don't think it's a blip but they have been able to maintain margins in the mid 30s as opposed to the low 30s."And as long as the price cuts trail the building material decline, gross margins should hold up at these levels. We have excess supply of key components...so the pricing trends will continue to be in Apple's favor."They are not going to be able to replace Steve Jobs, I think that's clear, but if they get an operationally oriented CEO, I think the strength of the product pipeline should sustain Apple's financial momentum for the foreseeable future."Steve is leaving the company in its best shape in history.

Yes, the management changes will create some uncertainty but I think people should focus on the strength of the company's product line and the track records of its execution."STEPHEN MASSOCCA, MANAGING DIRECTOR, WEDBUSH MORGAN"The number was significantly better than the Street was looking for and the stock is immediately up 10 percent in the after-hours market."It's a blowout number and there might have been a lot of people who were either short the stock or out of the name because of the Steve Jobs news, so it was springloaded here."This is a rear-view looking mirror but I think it does tell you to a certain degree that its cutting-edge technology product is still selling well even though the economy is not doing well."There are a few companies out there that continue to do well and are not particularly economically sensitive, and Apple is clearly a case of products that consumers are not cutting back on."SHAW WU, ANALYST, KAUFMAN BROSThe results "look very strong. It looks like they beat both on the bottom line and on the top line and it looks like Macs and iPod in particular beat expectations. It looks like iPhones came in a little light."There was a similar fear (about shrinking margins) last quarter. I think one of the things that's really helping them is that the component environment has also been very favorable. The inputs into their products processors, memory, flash, panels pricing on those products has come down a lot and that enables Apple to maintain their margins even though they are selling a lower-end mix."The change in leadership "is always going to be a concern and Steve is very important to the company. But we believe that Apple over the past 10 years has built a very deep bench.