Apple Inc.
APPLE INC (Form: 8-K, Received: 10/28/2013 16:31:56)

 

 

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

October 28, 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 October 28, 2013, Apple Inc. (“Apple”) issued a press release regarding Apple’s financial results for its fourth fiscal quarter ended September 28, 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 October 28, 2013.
99.2    Data sheet issued by Apple Inc. on October 28, 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: October 28, 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 October 28, 2013.
99.2    Data sheet issued by Apple Inc. on October 28, 2013.

Exhibit 99.1

Apple Reports Fourth Quarter Results

iPhone Sales Grow 26% to Establish New September Quarter Record

CUPERTINO, California—October 28, 2013—Apple ® today announced financial results for its fiscal 2013 fourth quarter ended September 28, 2013. The Company posted quarterly revenue of $37.5 billion and quarterly net profit of $7.5 billion, or $8.26 per diluted share. These results compare to revenue of $36 billion and net profit of $8.2 billion, or $8.67 per diluted share, in the year-ago quarter. Gross margin was 37 percent compared to 40 percent in the year-ago quarter. International sales accounted for 60 percent of the quarter’s revenue.

The Company sold 33.8 million iPhones, a record for the September quarter, compared to 26.9 million in the year-ago quarter. Apple also sold 14.1 million iPads during the quarter, compared to 14 million in the year-ago quarter. The Company sold 4.6 million Macs, compared to 4.9 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 November 14, 2013, to shareholders of record as of the close of business on November 11, 2013.

“We’re pleased to report a strong finish to an amazing year with record fourth quarter revenue, including sales of almost 34 million iPhones,” said Tim Cook, Apple’s CEO. “We’re excited to go into the holidays with our new iPhone 5c and iPhone 5s, iOS 7, the new iPad mini with Retina Display and the incredibly thin and light iPad Air, new MacBook Pros, the radical new Mac Pro, OS X Mavericks and the next generation iWork and iLife apps for OS X and iOS.”

“We generated $9.9 billion in cash flow from operations and returned an additional $7.8 billion in cash to shareholders through dividends and share repurchases during the September quarter, bringing cumulative payments under our capital return program to $36 billion,” said Peter Oppenheimer, Apple’s CFO.

Apple is providing the following guidance for its fiscal 2014 first quarter:

 

 

revenue between $55 billion and $58 billion

 

gross margin between 36.5 percent and 37.5 percent

 

operating expenses between $4.4 billion and $4.5 billion

 

other income/(expense) of $200 million

 

tax rate of 26.25 percent

Apple will provide live streaming of its Q4 2013 financial results conference call beginning at 2:00 p.m. PDT on October 28, 2013 at www.apple.com/quicktime/qtv/earningsq413 . 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, its Form 10-Q for the quarter ended June 29, 2013, and its Form 10-K for the year ended September 28, 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.

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     Twelve Months Ended  
     September 28,
2013
     September 29,
2012
    September 28,
2013
     September 29,
2012
 

Net sales

   $ 37,472       $ 35,966      $ 170,910       $ 156,508   

Cost of sales (1)

     23,601         21,565        106,606         87,846   
  

 

 

    

 

 

   

 

 

    

 

 

 

Gross margin

     13,871         14,401        64,304         68,662   
  

 

 

    

 

 

   

 

 

    

 

 

 

Operating expenses:

          

Research and development (1)

     1,168         906        4,475         3,381   

Selling, general and administrative (1)

     2,673         2,551        10,830         10,040   
  

 

 

    

 

 

   

 

 

    

 

 

 

Total operating expenses

     3,841         3,457        15,305         13,421   
  

 

 

    

 

 

   

 

 

    

 

 

 

Operating income

     10,030         10,944        48,999         55,241   

Other income/(expense), net

     113         (51     1,156         522   
  

 

 

    

 

 

   

 

 

    

 

 

 

Income before provision for income taxes

     10,143         10,893        50,155         55,763   

Provision for income taxes

     2,631         2,670        13,118         14,030   
  

 

 

    

 

 

   

 

 

    

 

 

 

Net income

   $ 7,512       $ 8,223      $ 37,037       $ 41,733   
  

 

 

    

 

 

   

 

 

    

 

 

 

Earnings per share:

          

Basic

   $ 8.31       $ 8.76      $ 40.03       $ 44.64   

Diluted

   $ 8.26       $ 8.67      $ 39.75       $ 44.15   

Shares used in computing earnings per share:

          

Basic

     904,163         938,343        925,331         934,818   

Diluted

     909,131         948,186        931,662         945,355   

Cash dividends declared per common share

   $ 3.05       $ 2.65      $ 11.40       $ 2.65   
(1)  Includes share-based compensation expense as follows:   

Cost of sales

   $ 88       $ 69      $ 350       $ 265   

Research and development

   $ 209       $ 168      $ 917       $ 668   

Selling, general and administrative

   $ 258       $ 211      $ 986       $ 807   


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

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

 

                                                 
     September 28,
2013
    September 29,
2012
 
ASSETS:     

Current assets:

    

Cash and cash equivalents

   $ 14,259      $ 10,746   

Short-term marketable securities

     26,287        18,383   

Accounts receivable, less allowances of $99 and $98, respectively

     13,102        10,930   

Inventories

     1,764        791   

Deferred tax assets

     3,453        2,583   

Vendor non-trade receivables

     7,539        7,762   

Other current assets

     6,882        6,458   
  

 

 

   

 

 

 

Total current assets

     73,286        57,653   

Long-term marketable securities

     106,215        92,122   

Property, plant and equipment, net

     16,597        15,452   

Goodwill

     1,577        1,135   

Acquired intangible assets, net

     4,179        4,224   

Other assets

     5,146        5,478   
  

 

 

   

 

 

 

Total assets

   $ 207,000      $ 176,064   
  

 

 

   

 

 

 
LIABILITIES AND SHAREHOLDERS' EQUITY:     

Current liabilities:

    

Accounts payable

   $ 22,367      $ 21,175   

Accrued expenses

     13,856        11,414   

Deferred revenue

     7,435        5,953   
  

 

 

   

 

 

 

Total current liabilities

     43,658        38,542   

Deferred revenue – non-current

     2,625        2,648   

Long-term debt

     16,960        0   

Other non-current liabilities

     20,208        16,664   
  

 

 

   

 

 

 

Total liabilities

     83,451        57,854   
  

 

 

   

 

 

 

Commitments and contingencies

    

Shareholders’ equity:

    

Common stock, no par value; 1,800,000 shares authorized; 899,213 and 939,208 shares issued and outstanding, respectively

     19,764        16,422   

Retained earnings

     104,256        101,289   

Accumulated other comprehensive income/(loss)

     (471     499   
  

 

 

   

 

 

 

Total shareholders’ equity

     123,549        118,210   
  

 

 

   

 

 

 

Total liabilities and shareholders’ equity

   $ 207,000      $ 176,064   
  

 

 

   

 

 

 

 


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

 

                                                 
     Twelve Months Ended  
     September 28,
2013
    September 29,
2012
 

Cash and cash equivalents, beginning of the year

   $ 10,746      $ 9,815   
  

 

 

   

 

 

 

Operating activities:

    

Net income

     37,037        41,733   

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

    

Depreciation and amortization

     6,757        3,277   

Share-based compensation expense

     2,253        1,740   

Deferred income tax expense

     1,141        4,405   

Changes in operating assets and liabilities:

    

Accounts receivable, net

     (2,172     (5,551

Inventories

     (973     (15

Vendor non-trade receivables

     223        (1,414

Other current and non-current assets

     1,080        (3,162

Accounts payable

     2,340        4,467   

Deferred revenue

     1,459        2,824   

Other current and non-current liabilities

     4,521        2,552   
  

 

 

   

 

 

 

Cash generated by operating activities

     53,666        50,856   
  

 

 

   

 

 

 

Investing activities:

    

Purchases of marketable securities

     (148,489     (151,232

Proceeds from maturities of marketable securities

     20,317        13,035   

Proceeds from sales of marketable securities

     104,130        99,770   

Payments made in connection with business acquisitions, net

     (496     (350

Payments for acquisition of property, plant and equipment

     (8,165     (8,295

Payments for acquisition of intangible assets

     (911     (1,107

Other

     (160     (48
  

 

 

   

 

 

 

Cash used in investing activities

     (33,774     (48,227
  

 

 

   

 

 

 

Financing activities:

    

Proceeds from issuance of common stock

     530        665   

Excess tax benefits from equity awards

     701        1,351   

Taxes paid related to net share settlement of equity awards

     (1,082     (1,226

Dividends and dividend equivalent rights paid

     (10,564     (2,488

Repurchase of common stock

     (22,860     0   

Proceeds from issuance of long-term debt, net

     16,896        0   
  

 

 

   

 

 

 

Cash used in financing activities

     (16,379     (1,698
  

 

 

   

 

 

 

Increase in cash and cash equivalents

     3,513        931   
  

 

 

   

 

 

 

Cash and cash equivalents, end of the year

   $ 14,259      $ 10,746   
  

 

 

   

 

 

 

Supplemental cash flow disclosure:

    

Cash paid for income taxes, net

   $ 9,128      $ 7,682   

Exhibit 99.2

Apple Inc.

Q4 2013 Unaudited Summary Data

(Units in thousands, Revenue in millions)

 

                                                                                                                                                                                             
    Q4’13     Q3’13     Q4’12     Sequential Change     Year/Year Change  
          Revenue           Revenue           Revenue           Revenue           Revenue  

Operating Segments

                     

Americas

    $ 13,941        $ 14,405        $ 13,810          - 3%          1%   

Europe

      8,005          7,614          8,023          5%          0%   

Greater China (a)

      5,733          4,641          5,427          24%          6%   

Japan

      3,341          2,543          2,367          31%          41%   

Rest of Asia Pacific

      1,980          2,046          2,110          - 3%          - 6%   

Retail

      4,472          4,074          4,229          10%          6%   
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

 

Total Apple

    $ 37,472        $ 35,323        $ 35,966          6%          4%   
   

 

 

     

 

 

     

 

 

         
                               
    Q4’13     Q3’13     Q4’12     Sequential Change     Year/Year Change  
    Units     Revenue     Units     Revenue     Units     Revenue     Units     Revenue     Units     Revenue  

Product Summary

                     

iPhone (b)

    33,797      $ 19,510        31,241      $ 18,154        26,910      $ 16,645        8%        7%        26%        17%   

iPad (b)

    14,079        6,186        14,617        6,374        14,036        7,133        - 4%        - 3%        0%        - 13%   

Mac (b)

    4,574        5,624        3,754        4,893        4,923        6,617        22%        15%        - 7%        - 15%   

iPod (b)

    3,498        573        4,569        733        5,344        820        - 23%        - 22%        - 35%        - 30%   

iTunes/Software/Services (c)

      4,260          3,990          3,496          7%          22%   

Accessories (d)

      1,319          1,179          1,255          12%          5%   
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

 

Total Apple

    $ 37,472        $ 35,323        $ 35,966          6%          4%   
   

 

 

     

 

 

     

 

 

         
         

 

 

                             

 

(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 iBooks Store, 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.