Apple
APPLE INC (Form: 8-K, Received: 07/19/2011 16:30:35)

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

July 19, 2011

Date of Report (date of earliest event reported)

 

 

APPLE INC.

(Exact name of Registrant as specified in its charter)

 

California   000-10030   94-2404110

(State or other jurisdiction of

incorporation)

  (Commission File Number)  

(I.R.S. Employer

Identification Number)

1 Infinite Loop

Cupertino, California 95014

(Address of principal executive offices) (Zip Code)

(408) 996-1010

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 2.02 Results of Operations and Financial Condition.

On July 19, 2011, Apple Inc. (“Apple”) issued a press release regarding Apple’s financial results for its third fiscal quarter ended June 25, 2011 and a related data sheet. A copy of Apple’s press release is attached hereto as Exhibit 99.1 and a copy of the related data sheet is attached hereto as Exhibit 99.2.

The information contained in this Current Report shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

The following exhibits are furnished herewith:

 

Exhibit

Number

  

Description

99.1    Text of press release issued by Apple Inc. on July 19, 2011.
99.2    Data sheet issued by Apple Inc. on July 19, 2011.


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    APPLE INC.

Date: July 19, 2011

    By:   /s/ Peter Oppenheimer
       

Peter Oppenheimer

Senior Vice President,

Chief Financial Officer


EXHIBIT INDEX

 

Exhibit

Number

  

Description

99.1    Text of press release issued by Apple Inc. on July 19, 2011.
99.2    Data sheet issued by Apple Inc. on July 19, 2011.

Exhibit 99.1

Apple Reports Third Quarter Results

All-Time Record Revenue and Earnings

iPhone Sales Grow 142 Percent; iPad Sales Grow 183 Percent

CUPERTINO, California—July 19, 2011—Apple ® today announced financial results for its fiscal 2011 third quarter ended June 25, 2011. The Company posted record quarterly revenue of $28.57 billion and record quarterly net profit of $7.31 billion, or $7.79 per diluted share. These results compare to revenue of $15.70 billion and net quarterly profit of $3.25 billion, or $3.51 per diluted share, in the year-ago quarter. Gross margin was 41.7 percent compared to 39.1 percent in the year-ago quarter. International sales accounted for 62 percent of the quarter’s revenue.

The Company sold 20.34 million iPhones in the quarter, representing 142 percent unit growth over the year-ago quarter. Apple sold 9.25 million iPads during the quarter, a 183 percent unit increase over the year-ago quarter. The Company sold 3.95 million Macs during the quarter, a 14 percent unit increase over the year-ago quarter. Apple sold 7.54 million iPods, a 20 percent unit decline from the year-ago quarter.

“We’re thrilled to deliver our best quarter ever, with revenue up 82 percent and profits up 125 percent,” said Steve Jobs, Apple’s CEO. “Right now, we’re very focused and excited about bringing iOS 5 and iCloud to our users this fall.”

“We are extremely pleased with our performance which drove quarterly cash flow from operations of $11.1 billion, an increase of 131 percent year-over-year,” said Peter Oppenheimer, Apple’s CFO. “Looking ahead to the fourth fiscal quarter of 2011, we expect revenue of about $25 billion and we expect diluted earnings per share of about $5.50.”

Apple will provide live streaming of its Q3 2011 financial results conference call beginning at 2:00 p.m. PDT on July 19, 2011 at www.apple.com/quicktime/qtv/earningsq311 . This webcast will also be available for replay for approximately two weeks thereafter.


This press release contains forward-looking statements including without limitation those about the Company’s estimated revenue and earnings per share. These statements involve risks and uncertainties, and actual results may differ. Risks and uncertainties include without limitation the effect of competitive and economic factors, and the Company’s reaction to those factors, on consumer and business buying decisions with respect to the Company’s products; continued competitive pressures in the marketplace; the ability of the Company to deliver to the marketplace and stimulate customer demand for new programs, products, and technological innovations on a timely basis; the effect that product introductions and transitions, changes in product pricing or mix, and/or increases in component costs could have on the Company’s gross margin; the inventory risk associated with the Company’s need to order or commit to order product components in advance of customer orders; the continued availability on acceptable terms, or at all, of certain components and services essential to the Company’s business currently obtained by the Company from sole or limited sources; the effect that the Company’s dependency on manufacturing and logistics services provided by third parties may have on the quality, quantity or cost of products manufactured or services rendered; risks associated with the Company’s international operations; the Company’s reliance on third-party intellectual property and digital content; the potential impact of a finding that the Company has infringed on the intellectual property rights of others; the Company’s dependency on the performance of distributors, carriers and other resellers of the Company’s products; the effect that product and service quality problems could have on the Company’s sales and operating profits; the continued service and availability of key executives and employees; war, terrorism, public health issues, natural disasters, and other circumstances that could disrupt supply, delivery, or demand of products; and unfavorable results of other legal proceedings. More information on potential factors that could affect the Company’s financial results is included from time to time in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s public reports filed with the SEC, including the Company’s Form 10-K for the fiscal year ended September 25, 2010, its Forms 10-Q for the quarters ended December 25, 2010 and March 26, 2011, and its Form 10-Q for the quarter ended June 25, 2011 to be filed with the SEC. The Company assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates.


Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App Store, and has recently introduced iPad 2 which is defining the future of mobile media and computing devices.

Press Contact:

Steve Dowling

Apple

dowling@apple.com

(408) 974-1896

Investor Relations Contacts:

Nancy Paxton

Apple

paxton1@apple.com

(408) 974-5420

Joan Hoover

Apple

hoover1@apple.com

(408) 974-4570

NOTE TO EDITORS: For additional information visit Apple’s PR website (www.apple.com/pr), or call Apple’s Media Helpline at (408) 974-2042.

© 2011 Apple Inc. All rights reserved. Apple, the Apple logo, Mac, Mac OS and Macintosh are trademarks of Apple. Other company and product names may be trademarks of their respective owners.


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except share amounts which are reflected in thousands and per share amounts)

 

September 30, September 30, September 30, September 30,
     Three Months Ended      Nine Months Ended  
     June 25,
2011
     June 26,
2010
     June 25,
2011
     June 26,
2010
 

Net sales

   $ 28,571       $ 15,700       $ 79,979       $ 44,882   

Cost of sales (1)

     16,649         9,564         47,541         26,710   
                                   

Gross margin

     11,922         6,136         32,438         18,172   
                                   

Operating expenses:

           

Research and development (1)

     628         464         1,784         1,288   

Selling, general and administrative (1)

     1,915         1,438         5,574         3,946   
                                   

Total operating expenses

     2,543         1,902         7,358         5,234   
                                   

Operating income

     9,379         4,234         25,080         12,938   

Other income and expense

     172         58         334         141   
                                   

Income before provision for income taxes

     9,551         4,292         25,414         13,079   

Provision for income taxes

     2,243         1,039         6,115         3,374   
                                   

Net income

   $ 7,308       $ 3,253       $ 19,299       $ 9,705   
                                   

Earnings per common share:

           

Basic

   $ 7.89       $ 3.57       $ 20.91       $ 10.69   

Diluted

   $ 7.79       $ 3.51       $ 20.63       $ 10.51   

Shares used in computing earnings per share:

           

Basic

     926,108         912,197         922,917         907,762   

Diluted

     937,810         927,361         935,688         923,341   

(1) Includes stock-based compensation expense as follows:

  

Cost of sales

   $ 52       $ 38       $ 155       $ 112   

Research and development

   $ 119       $ 80       $ 336       $ 240   

Selling, general and administrative

   $ 113       $ 101       $ 379       $ 303   


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions, except share amounts)

 

September 30, September 30,
     June 25,
2011
     September 25,
2010
 
ASSETS:      

Current assets:

     

Cash and cash equivalents

   $ 12,091       $ 11,261   

Short-term marketable securities

     16,304         14,359   

Accounts receivable, less allowances of $55 in each period

     6,102         5,510   

Inventories

     889         1,051   

Deferred tax assets

     1,892         1,636   

Vendor non-trade receivables

     5,369         4,414   

Other current assets

     4,251         3,447   
                 

Total current assets

     46,898         41,678   

Long-term marketable securities

     47,761         25,391   

Property, plant and equipment, net

     6,749         4,768   

Goodwill

     741         741   

Acquired intangible assets, net

     1,169         342   

Other assets

     3,440         2,263   
                 

Total assets

   $ 106,758       $ 75,183   
                 
LIABILITIES AND SHAREHOLDERS’ EQUITY:      

Current liabilities:

     

Accounts payable

   $ 15,270       $ 12,015   

Accrued expenses

     7,597         5,723   

Deferred revenue

     3,992         2,984   
                 

Total current liabilities

     26,859         20,722   

Deferred revenue – non-current

     1,407         1,139   

Other non-current liabilities

     9,149         5,531   
                 

Total liabilities

     37,415         27,392   
                 

Commitments and contingencies

     

Shareholders’ equity:

     

Common stock, no par value; 1,800,000,000 shares authorized; 926,903,779 and 915,970,050 shares issued and outstanding, respectively

     12,715         10,668   

Retained earnings

     56,239         37,169   

Accumulated other comprehensive income/(loss)

     389         (46
                 

Total shareholders’ equity

     69,343         47,791   
                 

Total liabilities and shareholders’ equity

   $ 106,758       $ 75,183   
                 


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

 

September 30, September 30,
     Nine Months Ended  
     June 25,
2011
    June 26,
2010
 

Cash and cash equivalents, beginning of the period

   $ 11,261      $ 5,263   
                

Operating activities:

    

Net income

     19,299        9,705   

Adjustments to reconcile net income to cash generated by operating activities:

    

Depreciation, amortization and accretion

     1,271        698   

Stock-based compensation expense

     870        655   

Deferred income tax expense

     2,232        1,298   

Changes in operating assets and liabilities:

    

Accounts receivable, net

     (592     (79

Inventories

     162        (487

Vendor non-trade receivables

     (955     (1,256

Other current and non-current assets

     (1,551     (1,001

Accounts payable

     2,480        2,812   

Deferred revenue

     1,276        806   

Other current and non-current liabilities

     2,608        (239
                

Cash generated by operating activities

     27,100        12,912   
                

Investing activities:

    

Purchases of marketable securities

     (75,133     (41,318

Proceeds from maturities of marketable securities

     16,396        19,758   

Proceeds from sales of marketable securities

     34,301        14,048   

Payments made in connection with business acquisitions, net of cash acquired

     0        (615

Payments for acquisition of property, plant and equipment

     (2,615     (1,245

Payments for acquisition of intangible assets

     (266     (63

Other

     34        (36
                

Cash used in investing activities

     (27,283     (9,471
                

Financing activities:

    

Proceeds from issuance of common stock

     577        733   

Excess tax benefits from equity awards

     915        652   

Taxes paid related to net share settlement of equity awards

     (479     (384
                

Cash generated by financing activities

     1,013        1,001   
                

Increase in cash and cash equivalents

     830        4,442   
                

Cash and cash equivalents, end of the period

   $ 12,091      $ 9,705   
                

Supplemental cash flow disclosure:

    

Cash paid for income taxes, net

   $ 2,563      $ 2,657   

Exhibit 99.2

Apple Inc.

Q3 2011 Unaudited Summary Data

 

Revenue Revenue Revenue Revenue Revenue Revenue Revenue Revenue Revenue Revenue
     Q2 2011      Q3 2010      Q3 2011      Sequential Change      Year/Year Change  
     CPU
Units K
     Revenue
$M
     CPU
Units K
     Revenue
$M
     CPU
Units K
     Revenue
$M
     CPU
Units
     Revenue      CPU
Units
     Revenue  

Operating Segments

                             

Americas

     1,217       $ 9,323         1,358       $ 6,227         1,487       $ 10,126         22%         9%         9%         63%   

Europe

     995         6,027         914         4,160         922         7,098         - 7%         18%         1%         71%   

Japan

     155         1,383         129         910         150         1,510         - 3%         9%         16%         66%   

Asia Pacific

     596         4,743         394         1,825         620         6,332         4%         34%         57%         247%   

Retail

     797         3,191         677         2,578         768         3,505         - 4%         10%         13%         36%   
                                                                 

Total Operating Segments

     3,760       $ 24,667         3,472       $ 15,700         3,947       $ 28,571         5%         16%         14%         82%   
                                                                 
     Units K      Revenue
$M
     Units K      Revenue
$M
     Units K      Revenue
$M
     Sequential Change      Year/Year Change  
                       Units      Revenue      Units      Revenue  

Product Summary

                             

Desktops (1)

     1,009       $ 1,441         1,004       $ 1,301         1,155       $ 1,580         14%         10%         15%         21%   

Portables (2)

     2,751         3,535         2,468         3,098         2,792         3,525         1%         0%         13%         14%   
                                                                 

Subtotal CPUs

     3,760         4,976         3,472         4,399         3,947         5,105         5%         3%         14%         16%   

iPod

     9,017         1,600         9,406         1,545         7,535         1,325         - 16%         - 17%         - 20%         - 14%   

Other Music Related Products and Services (3)

        1,634            1,214            1,571            - 4%            29%   

iPhone and Related Products and Services (4)

     18,647         12,298         8,398         5,334         20,338         13,311         9%         8%         142%         150%   

iPad and Related Products and Services (5)

     4,694         2,836         3,270         2,166         9,246         6,046         97%         113%         183%         179%   

Peripherals and Other Hardware (6)

        580            396            517            - 11%            31%   

Software, Service and Other Sales (7)

        743            646            696            - 6%            8%   
                                               

Total Apple

      $ 24,667          $ 15,700          $ 28,571            16%            82%   
                                               

 

(1) Includes iMac, Mac mini, Mac Pro and Xserve product lines.

 

(2) Includes MacBook, MacBook Air and MacBook Pro product lines.

 

(3) Includes sales from the iTunes Store, App Store, and iBookstore in addition to sales of iPod services and Apple-branded and third-party iPod accessories.

 

(4) Includes revenue recognized from iPhone sales, carrier agreements, services, and Apple-branded and third-party iPhone accessories.

 

(5) Includes revenue recognized from iPad sales, services, and Apple-branded and third-party iPad accessories.

 

(6) Includes sales of displays, wireless connectivity and networking solutions, and other hardware accessories.

 

(7) Includes sales from the Mac App Store in addition to sales of other Apple-branded and third-party Mac software and Mac and Internet services.

K = Units in thousands

$M = Amounts in millions