(Operator Instructions) Ladies and gentlemen a question-and-answer session will be conducted electronically. If you’d like to ask a question you may maker use of the * key and then press the digit 1 key on your touchtone telephone. If you are using a speaker phone please release your mute function so that your voice can reach our equipment. Once again ladies and gentlemen it is “*1” to ask a question. And your first question will come from Bill Shope with Credit Suisse.

Bill Shope - Credit Suisse

Okay great thank you. Steve, clearly your results and the guidance paint two very different pictures of the world and I was wondering, have you seen any new trends in recent business that would suggest such a disparity or is this really simply just prudence, given all the macro headlines we are all seeing right now?

Steven P. Jobs

Well, there’s a lot of prudence in there but it’s also October and October has always been a little bit of a foggy month for us. We are always biting our nails, wondering whether we ordered too many iPods or this or that for the holiday quarter because sales often don’t really take off until November some time. So the months of October and April are our slowest during the year and we think we are doing the right things. We think we know what the results may be but October and April are foggy months for us in terms of predicting the whole quarter but there’s a lot of prudence built in. We’re not economists and we read the same newspapers you do.

Bill Shope - Credit Suisse

Great, thank you.

Nancy Paxton

Thanks, Bill. Could we have the next question, please?

Operator

Your next question will come from Richard Gardner with Citigroup.

Richard Gardner – Citigroup

Thank you. Steve thanks for being on the call. I would like to start off with a question regarding share repurchase and just ask your and the board’s latest thoughts on share repurchase now. I understand that cash is a good thing to have in the current environment but you are using relatively little of that cash for things like retail store openings and for investments in the business. What are your thoughts on returning some to shareholders?

Steven P. Jobs

I think this economic downturn may present some extraordinary opportunities to companies that have cash. I think cash is already king and it may get more so that way. So we are very comfortable with our cash position in the bank and it’s not burning a hole in our pocket.

Richard Gardner – Citigroup

Okay, thank you and if I could follow-up, Peter, and maybe ask if you could give us a sense of how much of the gross margin outlook for the fourth quarter is related to the higher costs associated with the aluminum unibody enclosures, and maybe some sense of how much more expensive that is then the way you were doing things previously?

Peter Oppenheimer

Well, the guidance that I provided, Rich, the sequential decline really is driven from the introductions of the notebooks and iPods, which we couldn’t be more excited about. And there’s many, many new technologies, new features in those besides the unibody but that contributed. As I said on the last call, we were going to introduce these products. They were initially going to have higher costs and through volume manufacturing and cost engineering, we’re going to work down, work to get down the cost curve over time. But we’ve made a big investment in these products and these are some of the best we’ve ever shipped.

Richard Gardner – Citigroup