NEW YORK — As vacancies increase and retail sales throughout the U.S. remain a shadow of the decade's boom, Apple Inc.'s stores are defying the recession.

At Fifth Avenue and 59th Street, the noon-day line on Aug. 11 snaked out the front door. More than a dozen people waited to buy an iPhone, which runs from $99 to $299, plus at least another $70 a month for a service plan. Every computer, seat and station was occupied by a visitor to midtown Manhattan.

As the rest of the retail industry suffered, Apple increased revenue at its stores to $3 billion for the first six months of the year, 2.5 percent more than in the same period last year. Meanwhile, sales at all U.S. retailers fell 9.2 percent, according to the U.S. Commerce Department.

Retail sales in New York City have fallen 8 percent to 10 percent from comparable 2008 levels, according to the Federal Reserve's Beige Book business survey published July 29.

"Even if they are not spending money elsewhere, people are still spending money on technology gadgets," said Patricia Edwards, a retail analyst and founder of Storehouse Partners LLC in Bellevue, Wash. "It's both a need and a want. It fulfills that retail-therapy component."

IPHONE IS THE DRIVER

Apple's store performance in the past year has been driven by the iPhone, according to Charlie Wolf, an analyst who covers Apple at Needham & Co. in New York. The retail operation saw a 22 percent increase in traffic during the quarter ended June 27, hosting a total of 38.6 million visitors, Chief Financial Officer Peter Oppenheimer said on a conference call in July.

The shares of Cupertino, Calif.-based Apple ended last week almost double what they were at the start of the year.

New store openings have helped increase Apple's sales. Ron Johnson, Apple's retail chief, said by phone that the company was so "thrilled" with the performance of its three Manhattan operations — the others are in SoHo and the Meatpacking district — it will open a fourth on the Upper West Side soon.

Apple's store layout puts every item for sale on display, which encourages shoppers to sample the gadgetry, said Edwards of Storehouse Partners.

According to a survey conducted by Interbrand Corp. in December 2008, mobile phones are one of the household budget items consumers are least willing to cut back on. Respondents said they'd sooner skimp on housing, clothing, groceries and tobacco products. The only items they're more reluctant to cut spending on than mobile service are prescription and over-the-counter medicines.

Wolf credits the stores for being as much about service as shopping. He said Apple overstaffs its outlets so that customers get help quickly. He said the store workers and the classes they run on how to use Apple products help establish "a community- like" atmosphere.

"They create what I call an infectious sort of environment," Wolf said.

Apple opened its first retail outlet in May 2001 to boost visibility of the Macintosh computer, which generates about 40 percent of its sales. It had 258 stores worldwide as of June 27.

The Fifth Avenue location, which opened in May 2006, employs 500 workers. Visitors enter a 32-foot glass cube and descend a translucent spiral staircase into the store, which is built under what used to be known as GM Plaza. Apple sells iPods on one side of the white-washed space and Macs on the other.

THE NEW YORK MIX

One of the shoppers interviewed by Bloomberg this month at the Fifth Avenue store was Richard Granier, 55, chief executive officer of holding company Hestiun in Marbella, Spain. He bought a $99.95 Sony clock radio that uses Apple music players, three $29 iPhone chargers and several video games.

"I come here whenever I am in New York," Granier said.

MaryAnn Davidson, 36, snapped a photo of the Apple store with her iPhone before entering.

"Very cool store, lots of light, lots of people," said the homemaker, who is from Helmond, Netherlands. She said she had set aside $570 to spend at the store on iPods and headphones.

It is the only Apple store that's open 24 hours a day, seven days a week. Tourists dominate during the day and New Yorkers tend to visit at night, Johnson said.

"The middle of the night is a really interesting time," said Johnson, who was an executive at Target Corp. before Apple Chief Executive Officer Steve Jobs hired him in 2000. "It's the waiters in the restaurants, it's the actors on the stage. When they're off work, they may not want to go off to a club or want to go home."

At 1:45 a.m. on Aug. 15, there were about 30 people in the store. A display of iPhones doubled as a free, international calling center as shoppers dialed friends in California, Antigua and London. Manhattan resident Marie Perez, 15, and her two teenage friends each positioned themselves in front of an iPod Nano and stood motionless for an hour as they listened to music.

Antonio Delgado, 41, a dump truck operator from Queens, was there to buy an "iTouch," or what Apple calls an iPod touch, with hopes of using it as a mobile phone. He said he had $250 to spend, and that the money was worth it because of the touch-screen capability.

"I'm not married, so I don't have to worry about it," he said of his pending purchase and his late-night hours.

Some people even use the Fifth Avenue store as a "pick-up place," said Consolo, who passes the location every day on her way to work. Tourists used to ask how to find Bloomingdale's, Saks and Louis Vuitton, she said.

"Now they say Apple store, Apple store," Consolo said by phone. "It's the main event."