Business Highlights

SAN JOSE — Apple Computer Inc.’s rising fortunes aren’t showing any sign of waning.

The maker of iPods and Macintosh computers Wednesday reported sizzling sales that boosted quarterly profits by 27 percent and put its fiscal 2006 revenue at a record $19.3 billion, up from its previous all-time high of $13.9 billion last year.

Apple also ended its fiscal year with more than $10 billion in cash, up from more than $8 billion fiscal 2005.

Apple said it earned $546 million in the quarter ended Sept. 30, or 62 cents per share. That compared with net income of $430 million, 50 cents per share, in the same period last year.

Revenue for the quarter totaled $4.84 billion, a 32 percent jump from $3.68 billion last year.

The average estimate by analysts was for earnings of 51 cents per share on sales of $4.66 billion, according to Thomson Financial.

Apple’s iPod-iTunes juggernaut has helped the company reap record profits in recent years, but some of the earnings might be eroded when Apple later restates some quarterly reports due to earlier mishandling of stock options accounting.

Apple shipped some video iPods with Windows computer virus

SAN JOSE — In another example of how mobile gadgets can carry malicious programs, Apple Computer Inc. said a fraction of its iPod players sold in the past month contained a virus that affects Windows systems.

The problem affected less than 1 percent of the video iPods that were available for purchase after Sept. 12, according to a posting on Apple’s technical support Web site. The company has received less than 25 reports concerning the problem, Apple said.

The iPods got the virus from a Windows computer at one of its manufacturing plants, Apple said. The virus, RavMonE.exe, is known to spread through external data storage devices when they are connected to computers and affects only machines running the Windows operating system from Apple rival Microsoft Corp. Security experts say the virus opens up further security holes for hackers. Up-to-date anti-virus software included with most Windows computers should detect and remove it, Apple said.

EBay beats expectations as profit increases 10 percent

SAN FRANCISCO — EBay Inc. reported Wednesday that third-quarter profit increased 10 percent from the same period last year, beating Wall Street’s moderate expectations and encouraging executives to raise earnings forecasts for the year.

The San Jose-based online auction company earned $280.9 million, or 20 cents per share, for the three months ended Sept. 30, compared to $254.97 million, or 18 cents per share in the year-ago period.

Revenue for the third quarter totaled $1.45 billion, up 31 percent from last year’s $1.11 billion.

Excluding charges unrelated to ongoing operations, eBay earned $367.41 million, or 26 cents per share, up nearly 24 percent from the same quarter last year, when eBay earned $280.16 million, or 20 cents per share.

Big plunge in energy costs pushes consumer prices down in September

WASHINGTON — Consumer prices fell by the largest amount in 10 months in September, easing worries that inflation was about to get out of control.

The Labor Department reported that the Consumer Price Index dipped by 0.5 percent last month, a better-than-expected performance that was led by a huge decline in gasoline and other energy products.

Core inflation, which excludes energy and food, edged up by a moderate 0.2 percent, the third straight month of modest gains following higher readings earlier in the year.

Wall Street investors cheered the news, believing it will convince the Federal Reserve that its goal of slowing the economy enough to cool inflation pressures is working and officials won’t feel the need to boost rates further either at next week’s meeting or for the rest of the year.

The Dow Jones industrial average briefly traded above the 12,000 mark before retreating. The index of blue chip stocks still managed to close at a record, gaining 42.66 points to end the day at 11,992.68. It was the eighth record close in the past two weeks.

"We are in the midst of a near picture-perfect soft-landing,” said Bernard Baumohl, head of the Economic Outlook Group, a New Jersey forecasting firm.