Apple: Out of the Red

Enough people are loving their iMacs right now to pull Apple's earnings out of the red for the first time in three years -- and enough, at 68 cents a share for the third quarter, to soundly wallop Street estimates. But in the cutthroat computer industry, in which the future of a company rides on its market share, Steve Jobs' babe is far from being out of the woods. "If you shrink a company to the size of its existing niche, it's simple to turn a profit," says TIME tech correspondent Michael Krantz. "It's good that they've put out a cool consumer product like the iMac, which is selling well. It's necessary for success -- but not sufficient."

Lucky for Jobs that in his business, the spirit of the underdog is alive and well. Microsoft begins an antitrust trial Monday in which it's almost unanimously cast as the heavy, and as if to prove it Bill Gates was hissed by some software customers Wednesday morning in the middle of defending his company's right to play hardball. The Apple cult is as emotional these days as ever, and Jobs -- who with characteristic flourish delivered the happy news to a packed house near Cupertino while the markets were still open -- still has his reputation as a visionary. But even as iMacs fly off the shelves, Windows PCs still outsell them 10 to 1, and software developers still tend to turn up their noses at writing code for a platform with only 10 percent of the market. Yes, Apple is on a roll -- but it's got an awfully long way to go.