Apple Inc.
APPLE INC (Form: 8-K, Received: 07/23/2013 16:32:05)

 

 

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 23, 2013

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 23, 2013, Apple Inc. (“Apple”) issued a press release regarding Apple’s financial results for its third fiscal quarter ended June 29, 2013 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 23, 2013.
99.2    Data sheet issued by Apple Inc. on July 23, 2013.


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 23, 2013

    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 23, 2013.
99.2    Data sheet issued by Apple Inc. on July 23, 2013.

Exhibit 99.1

Apple Reports Third Quarter Results

Sales of 31 Million iPhones Set New June Quarter Record

CUPERTINO, California—July 23, 2013—Apple ® today announced financial results for its fiscal 2013 third quarter ended June 29, 2013. The Company posted quarterly revenue of $35.3 billion and quarterly net profit of $6.9 billion, or $7.47 per diluted share. These results compare to revenue of $35 billion and net profit of $8.8 billion, or $9.32 per diluted share, in the year-ago quarter. Gross margin was 36.9 percent compared to 42.8 percent in the year-ago quarter. International sales accounted for 57 percent of the quarter’s revenue.

The Company sold 31.2 million iPhones, a record for the June quarter, compared to 26 million in the year-ago quarter. Apple also sold 14.6 million iPads during the quarter, compared to 17 million in the year-ago quarter. The Company sold 3.8 million Macs, compared to 4 million in the year-ago quarter.

Apple’s Board of Directors has declared a cash dividend of $3.05 per share of the Company’s common stock. The dividend is payable on August 15, 2013, to shareholders of record as of the close of business on August 12, 2013.

“We are especially proud of our record June quarter iPhone sales of over 31 million and the strong growth in revenue from iTunes, Software and Services,” said Tim Cook, Apple’s CEO. “We are really excited about the upcoming releases of iOS 7 and OS X Mavericks, and we are laser-focused and working hard on some amazing new products that we will introduce in the fall and across 2014.”

“We generated $7.8 billion in cash flow from operations during the quarter and are pleased to have returned $18.8 billion in cash to shareholders through dividends and share repurchases,” said Peter Oppenheimer, Apple’s CFO.

Apple is providing the following guidance for its fiscal 2013 fourth quarter:

 

 

revenue between $34 billion and $37 billion

 

 

gross margin between 36 percent and 37 percent

 

 

operating expenses between $3.9 billion and $3.95 billion

 

 

other income/(expense) of $200 million

 

 

tax rate of 26.5%

Apple will provide live streaming of its Q3 2013 financial results conference call beginning at 2:00 p.m. PDT on July 23, 2013 at www.apple.com/quicktime/qtv/earningsq313 . 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, gross margin, operating expenses, other income/(expense), and tax rate. 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 29, 2012, its Form 10-Q for the quarter ended December 29, 2012, its Form 10-Q for the quarter ended March 30, 2013, and its Form 10-Q for the quarter ended June 29, 2013 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 is defining the future of mobile media and computing devices with iPad.

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.

© 2013 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 number of shares which are reflected in thousands and per share amounts)

 

     Three Months Ended     Nine Months Ended  
     June 29,
2013
    June 30,
2012
    June 29,
2013
    June 30,
2012
 

Net sales

   $       35,323      $       35,023      $     133,438      $     120,542   

Cost of sales (1)

     22,299        20,029        83,005        66,281   
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross margin

     13,024        14,994        50,433        54,261   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses:

        

Research and development (1)

     1,178        876        3,307        2,475   

Selling, general and administrative (1)

     2,645        2,545        8,157        7,489   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     3,823        3,421        11,464        9,964   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     9,201        11,573        38,969        44,297   

Other income/(expense), net

     234        288        1,043        573   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before provision for income taxes

     9,435        11,861        40,012        44,870   

Provision for income taxes

     2,535        3,037        10,487        11,360   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

   $ 6,900      $ 8,824      $ 29,525      $ 33,510   
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per share:

        

Basic

   $ 7.51      $ 9.42      $ 31.67      $ 35.89   

Diluted

   $ 7.47      $ 9.32      $ 31.44      $ 35.48   

Shares used in computing earnings per share:

        

Basic

     918,618        936,596        932,388        933,672   

Diluted

     924,265        947,059        939,172        944,440   
        

Cash dividends declared per common share

   $ 3.05      $ 0      $ 8.35      $ 0   

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

        

Cost of sales

   $ 90      $ 70      $ 262      $ 196   

Research and development

   $ 245      $ 172      $ 708      $ 500   

Selling, general and administrative

   $ 243      $ 206      $ 728      $ 596   


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions, except number of shares which are reflected in thousands)

 

                                                 
     June 29,
2013
    September 29,
2012
 
ASSETS:     

Current assets:

    

Cash and cash equivalents

   $ 11,248      $ 10,746   

Short-term marketable securities

     31,358        18,383   

Accounts receivable, less allowances of $104 and $98, respectively

     8,839        10,930   

Inventories

     1,697        791   

Deferred tax assets

     3,193        2,583   

Vendor non-trade receivables

     4,614        7,762   

Other current assets

     7,270        6,458   
  

 

 

   

 

 

 

Total current assets

     68,219        57,653   

Long-term marketable securities

     104,014        92,122   

Property, plant and equipment, net

     16,327        15,452   

Goodwill

     1,522        1,135   

Acquired intangible assets, net

     4,353        4,224   

Other assets

     5,421        5,478   
  

 

 

   

 

 

 

Total assets

   $ 199,856      $ 176,064   
  

 

 

   

 

 

 
LIABILITIES AND SHAREHOLDERS’ EQUITY:   

Current liabilities:

    

Accounts payable

   $ 15,516      $ 21,175   

Accrued expenses

     13,470        11,414   

Deferred revenue

     7,333        5,953   
  

 

 

   

 

 

 

Total current liabilities

     36,319        38,542   

Deferred revenue – non-current

     2,672        2,648   

Long-term debt

     16,958        0   

Other non-current liabilities

     20,553        16,664   
  

 

 

   

 

 

 

Total liabilities

     76,502        57,854   
  

 

 

   

 

 

 

Commitments and contingencies

    

Shareholders’ equity:

    

Common stock, no par value; 1,800,000 shares authorized; 908,442 and 939,208 shares issued and outstanding, respectively

     19,024        16,422   

Retained earnings

     104,564        101,289   

Accumulated other comprehensive (loss)/income

     (234     499   
  

 

 

   

 

 

 

Total shareholders’ equity

     123,354        118,210   
  

 

 

   

 

 

 

Total liabilities and shareholders’ equity

   $ 199,856      $ 176,064   
  

 

 

   

 

 

 


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

 

                                                 
     Nine Months Ended  
     June 29,
2013
    June 30,
2012
 

Cash and cash equivalents, beginning of the period

   $ 10,746      $ 9,815   
  

 

 

   

 

 

 

Operating activities:

    

Net income

     29,525        33,510   

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

    

Depreciation and amortization

     4,974        2,296   

Share-based compensation expense

     1,698        1,292   

Deferred income tax expense

     2,524        4,066   

Changes in operating assets and liabilities:

    

Accounts receivable, net

     2,091        (2,278

Inventories

     (906     (346

Vendor non-trade receivables

     3,148        (293

Other current and non-current assets

     484        (3,238

Accounts payable

     (4,740     2,450   

Deferred revenue

     1,404        2,575   

Other current and non-current liabilities

     3,556        1,686   
  

 

 

   

 

 

 

Cash generated by operating activities

     43,758        41,720   
  

 

 

   

 

 

 

Investing activities:

    

Purchases of marketable securities

     (122,681     (121,091

Proceeds from maturities of marketable securities

     13,963        10,344   

Proceeds from sales of marketable securities

     81,734        73,140   

Payments made in connection with business acquisitions, net

     (443     (350

Payments for acquisition of property, plant and equipment

     (6,210     (4,834

Payments for acquisition of intangible assets

     (560     (1,067

Other

     (188     (56
  

 

 

   

 

 

 

Cash used in investing activities

     (34,385     (43,914
  

 

 

   

 

 

 

Financing activities:

    

Proceeds from issuance of common stock

     335        433   

Excess tax benefits from equity awards

     644        1,036   

Taxes paid related to net share settlement of equity awards

     (1,001     (1,145

Dividends and dividend equivalent rights paid

     (7,795     0   

Repurchase of common stock

     (17,950     0   

Proceeds from issuance of long-term debt, net

     16,896        0   
  

 

 

   

 

 

 

Cash (used in)/generated by financing activities

     (8,871     324   
  

 

 

   

 

 

 

Increase/(decrease) in cash and cash equivalents

     502        (1,870
  

 

 

   

 

 

 

Cash and cash equivalents, end of the period

   $ 11,248      $ 7,945   
  

 

 

   

 

 

 

Supplemental cash flow disclosure:

    

Cash paid for income taxes, net

   $ 7,188      $ 5,901   

Exhibit 99.2

Apple Inc.

Q3 2013 Unaudited Summary Data

(Units in thousands, Revenue in millions)

 

                                                                                                                                                                                             
    Q3’13     Q2’13     Q3’12     Sequential Change     Year/Year Change  
          Revenue           Revenue           Revenue           Revenue           Revenue  

Operating Segments

                     

Americas

    $ 14,405        $ 14,052        $ 12,806          3%          12%   

Europe

      7,614          9,800          8,237          - 22%          - 8%   

Greater China (a)

      4,641          8,213          5,389          - 43%          - 14%   

Japan

      2,543          3,135          2,009          - 19%          27%   

Rest of Asia Pacific

      2,046          3,162          2,498          - 35%          - 18%   

Retail

      4,074          5,241          4,084          - 22%          0%   
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

 

Total Apple

    $ 35,323        $ 43,603        $ 35,023          - 19%          1%   
                               
    Q3’13     Q2’13     Q3’12     Sequential Change     Year/Year Change  
    Units     Revenue     Units     Revenue     Units     Revenue     Units     Revenue     Units     Revenue  

Product Summary

                     

iPhone (b)

    31,241      $ 18,154        37,430      $ 22,955        26,028      $ 15,821        - 17%        - 21%        20%        15%   

iPad (b)

    14,617        6,374        19,477        8,746        17,042        8,779        - 25%        - 27%        - 14%        - 27%   

Mac (b)

    3,754        4,893        3,952        5,447        4,020        4,933        - 5%        - 10%        - 7%        - 1%   

iPod (b)

    4,569        733        5,633        962        6,751        1,060        - 19%        - 24%        - 32%        - 31%   

iTunes/Software/Services (c)

      3,990          4,114          3,203          - 3%          25%   

Accessories (d)

      1,179          1,379          1,227          - 15%          - 4%   
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

 

Total Apple

          $ 35,323        $ 43,603        $ 35,023          - 19%          1%   

 

(a) Greater China includes China, Hong Kong and Taiwan.

 

(b) Includes deferrals and amortization of related non-software services and software upgrade rights.

 

(c) Includes revenue from sales on the iTunes Store, the App Store, the Mac App Store, and the iBookstore, and revenue from sales of AppleCare, licensing and other services.

 

(d) Includes sales of hardware peripherals and Apple-branded and third-party accessories for iPhone, iPad, Mac and iPod.