STEVE JOBS, the chief executive of Apple Computer, dismissed claims that the company was facing a growth slowdown, insisting that a sharp drop in sales of the iPod was “not a cause for concern”.

Mr Jobs blamed a drop in sales of MP3 portable music devices from 14 million to 8.5 million on the exceptionally strong demand during the holiday season.

He said he remained optimistic about the growth prospects for the iPod, adding: “To be honest, nobody has ever sold 8.5 million music players in a quarter.”

However, the fall, during the fiscal second quarter, marks the first time in more than three years that iPod shipments have not increased on the previous quarter. The sales figure was also about one million short of what Wall Street had expected.

Analysts said the drop in iPod sales, which was accompanied by a forecast that was below expectations, signalled that the company was no longer set to forge ahead at the same pace.

Significantly, Apple has not recently introduced new versions of the iPod to help to lift sales. Meanwhile several rival products have come on to the market.

Shipments of Apple Macintosh computers also fell in the period to 1.1 million, down from 1.25 million during the holiday period.

Stephen Coleman, chief investment officer for Daedalus Capital LLC, a US investment-advisory company, said: “I think that number (of iPod sales) is light. I think that is what happens — they are reaching a certain maturity.”

Net profit at the group rose to $410 million (£230 million), up from $290 million a year earlier, on revenues of $4.36 billion. Sales were better than the $4.3 billion that Apple had forecast but less than the $4.52 billion estimate of some analysts.

Apple said that Macintosh computer sales had been hit by the move, currently under way, to switch all Mac products to using microprocessors from Intel. The transition should be completed by the end of this year, it said.

The company said that some customers were putting off purchases of Macs until more models were introduced that used Intel chips. Others, he said, were waiting until more application software was available on the new computers.

Mr Jobs said the Intel transition was happening far faster than had previous switches.

Apple’s shares climbed $1.98 to close at $67.63. Barry Jaruzelski, at the consultancy Booz, Allen, Hamilton, said: “(Apple) essentially are the MP3 market. So far, they haven’t hit saturation point.”

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