For the first time in its history, Apple Computer Inc. will temporarily halt production of its personal computers to let demand catch up with an oversupply.
The Silicon Valley company, with annual sales of $1.5 billion, said last week that it would shut down assembly lines for one week this month for its Apple II computers and one week in April for its 1-year-old line of Macintosh computers.
"When we announced our earnings in January, we announced our best sales in our history," said Apple spokeswoman Barbara Krause, "but Apple President John Sculley also said that the next quarter would be 'extremely challenging' because we didn't have a complete sell-through at Christmas."
The result is that "dealers still had a lot of Apple inventory in stock," said Krause, "and we had more inventory than we'd like, so we're stopping production."
The shutdown reflects both a general slowdown in the retail sales of the less sophisticated personal computers -- the Apple IIe is nearly 8 years old -- and Apple's dependence on computer stores for the sale of its machines.
"We think Apple's problems are two-fold," says Michele Preston, a vice president with L. F. Rothschild, Unterberg and Towbin. "Sales are off at the low end nearly 65 percent versus December sales, and . . . the company is so oriented to the retail channel."
Unlike International Business Machines Corp., which has its own direct-sales force in addition to computer stores to sell its popular personal computers, Apple relies almost exclusively on retail distribution. Consequently, the company is particularly vulnerable if retailers over-order and sales slacken.
But Apple is not the only company affected by flagging demand. "The first quarter has been soft for everybody," said John C. Holtzman, an analyst with the Gartner Group. "It's been an average-to-poor quarter for most companies."
While IBM publicly says that sales of its personal computers for business remain brisk, L. F. Rothschild's Preston asserts that sales of IBM's PCjr, a low-end computer, are off by more than 60 percent this quarter from the Christmas quarter just past. While post-Christmas sales are usually lower than Christmas-season sales, Preston and Holtzman both note that the sales drop for low-end computers was larger than expected.
In addition, sales for Apple's Macintosh computer -- the machine that Apple is counting on to penetrate the lucrative office market -- have been lower than Apple has publicly expected. Preston said that sales would pick up when Lotus Development Corp., a leading personal computer software company, started shipping its programs for the Macintosh this year.
However, most analysts contend it will continue to be difficult for Apple to compete successfully with the $46 billion-a-year IBM in the business personal computer market.
In the home computer area, Coleco Industries yesterday announced a net 1984 loss of $79.8 million as a direct result of withdrawing its Adam computer system from the market and disposing of Adam inventory. The fourth-quarter loss from Adam was $93.2 million.