Apple
APPLE INC (Form: 8-K, Received: 04/27/2015 16:33:19)

 

 

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

April 27, 2015

Date of Report (Date of earliest event reported)

 

 

 

LOGO

Apple Inc.

(Exact name of Registrant as specified in its charter)

 

California   001-36743   94-2404110

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

  (IRS. Employer
Identification No.)

1 Infinite Loop

Cupertino, California 95014

(Address of principal executive offices) (Zip Code)

(408) 996-1010

(Registrant’s telephone number, including area code)

Not applicable

(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 April 27, 2015, Apple Inc. (“Apple”) issued a press release regarding Apple’s financial results for its second fiscal quarter ended March 28, 2015 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.

 

Exhibit

Number

  

Exhibit Description

99.1    Press release issued by Apple Inc. on April 27, 2015.
99.2    Data sheet issued by Apple Inc. on April 27, 2015.


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.

 

Date: April 27, 2015 Apple Inc.
By: /s/ Luca Maestri

Luca Maestri

Senior Vice President,

Chief Financial Officer


Exhibit Index

 

Exhibit

Number

  

Exhibit Description

99.1    Press release issued by Apple Inc. on April 27, 2015.
99.2    Data sheet issued by Apple Inc. on April 27, 2015.

Exhibit 99.1

Apple Reports Record Second Quarter Results

Strong performance of iPhone, Mac & App Store drives 27% revenue growth & 40% EPS growth, setting new second quarter records

CUPERTINO, California—April 27, 2015—Apple ® today announced financial results for its fiscal 2015 second quarter ended March 28, 2015. The Company posted quarterly revenue of $58 billion and quarterly net profit of $13.6 billion, or $2.33 per diluted share. These results compare to revenue of $45.6 billion and net profit of $10.2 billion, or $1.66 per diluted share, in the year-ago quarter. Gross margin was 40.8 percent compared to 39.3 percent in the year-ago quarter. International sales accounted for 69 percent of the quarter’s revenue.

The growth was fueled by record second quarter sales of iPhone ® and Mac ® and all-time record performance of the App Store SM .

“We are thrilled by the continued strength of iPhone, Mac and the App Store, which drove our best March quarter results ever,” said Tim Cook, Apple’s CEO. “We’re seeing a higher rate of people switching to iPhone than we’ve experienced in previous cycles, and we’re off to an exciting start to the June quarter with the launch of Apple Watch.”

“The tremendous customer demand for our products and services in the March quarter drove revenue growth of 27 percent and EPS growth of 40 percent,” said Luca Maestri, Apple’s CFO. “Cash flow from operations was also outstanding at $19.1 billion.”

Apple is providing the following guidance for its fiscal 2015 third quarter:

 

 

revenue between $46 billion and $48 billion

 

 

gross margin between 38.5 percent and 39.5 percent

 

 

operating expenses between $5.65 billion and $5.75 billion

 

 

other income/(expense) of $350 million

 

 

tax rate of 26.3 percent

Apple will provide live streaming of its Q2 2015 financial results conference call beginning at 2:00 p.m. PDT on April 27, 2015 at www.apple.com/quicktime/qtv/earningsq215 . 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 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 27, 2014, its Form 10-Q for the fiscal quarter ended December 27, 2014, and its Form 10-Q for the fiscal quarter ended March 28, 2015 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:

Josh Rosenstock

Apple

jrosenstock@apple.com

(408) 974-2414

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.

© 2015 Apple Inc. All rights reserved. Apple, the Apple logo, Mac, Mac OS, Macintosh, iPhone and App Store 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      Six Months Ended  
     March 28,
2015
     March 29,
2014
     March 28,
2015
     March 29,
2014
 

Net sales

   $ 58,010       $ 45,646       $ 132,609       $ 103,240   

Cost of sales (1)

     34,354         27,699         79,212         63,447   
  

 

 

    

 

 

    

 

 

    

 

 

 

Gross margin

  23,656      17,947      53,397      39,793   
  

 

 

    

 

 

    

 

 

    

 

 

 

Operating expenses:

Research and development  (1)

  1,918      1,422      3,813      2,752   

Selling, general and administrative  (1)

  3,460      2,932      7,060      5,985   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total operating expenses

  5,378      4,354      10,873      8,737   
  

 

 

    

 

 

    

 

 

    

 

 

 

Operating income

  18,278      13,593      42,524      31,056   

Other income/(expense), net

  286      225      456      471   
  

 

 

    

 

 

    

 

 

    

 

 

 

Income before provision for income taxes

  18,564      13,818      42,980      31,527   

Provision for income taxes

  4,995      3,595      11,387      8,232   
  

 

 

    

 

 

    

 

 

    

 

 

 

Net income

$ 13,569    $ 10,223    $ 31,593    $ 23,295   
  

 

 

    

 

 

    

 

 

    

 

 

 

Earnings per share:

Basic

$ 2.34    $ 1.67    $ 5.43    $ 3.76   

Diluted

$ 2.33    $ 1.66    $ 5.39    $ 3.74   

Shares used in computing earnings per share:

Basic

  5,793,799      6,123,302      5,818,411      6,197,903   

Diluted

  5,834,858      6,156,699      5,858,330      6,233,430   

Cash dividends declared per share

$ 0.47    $ 0.44    $ 0.94    $ 0.88   
(1)  Includes share-based compensation expense as follows:   

Cost of sales

$ 142    $ 110    $ 282    $ 219   

Research and development

$ 384    $ 300    $ 758    $ 589   

Selling, general and administrative

$ 401    $ 286    $ 775    $ 569   


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

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

 

                                                 
     March 28,
2015
     September 27,
2014
 
ASSETS:   

Current assets:

     

Cash and cash equivalents

   $ 14,489       $ 13,844   

Short-term marketable securities

     18,607         11,233   

Accounts receivable, less allowances of $83 and $86, respectively

     10,905         17,460   

Inventories

     2,396         2,111   

Deferred tax assets

     5,141         4,318   

Vendor non-trade receivables

     7,259         9,759   

Other current assets

     9,094         9,806   
  

 

 

    

 

 

 

Total current assets

  67,891      68,531   

Long-term marketable securities

  160,443      130,162   

Property, plant and equipment, net

  20,151      20,624   

Goodwill

  4,711      4,616   

Acquired intangible assets, net

  4,061      4,142   

Other assets

  3,937      3,764   
  

 

 

    

 

 

 

Total assets

$ 261,194    $ 231,839   
  

 

 

    

 

 

 
LIABILITIES AND SHAREHOLDERS’ EQUITY:   

Current liabilities:

Accounts payable

$ 23,159    $ 30,196   

Accrued expenses

  22,827      18,453   

Deferred revenue

  8,944      8,491   

Commercial paper

  3,799      6,308   
  

 

 

    

 

 

 

Total current liabilities

  58,729      63,448   

Deferred revenue – non-current

  3,571      3,031   

Long-term debt

  40,072      28,987   

Other non-current liabilities

  29,816      24,826   
  

 

 

    

 

 

 

Total liabilities

  132,188      120,292   
  

 

 

    

 

 

 

Commitments and contingencies

Shareholders’ equity:

Common stock and additional paid-in capital, $0.00001 par value: 12,600,000 shares authorized; 5,762,278 and 5,866,161 shares issued and outstanding, respectively

  25,376      23,313   

Retained earnings

  100,920      87,152   

Accumulated other comprehensive income

  2,710      1,082   
  

 

 

    

 

 

 

Total shareholders’ equity

  129,006      111,547   
  

 

 

    

 

 

 

Total liabilities and shareholders’ equity

$ 261,194    $ 231,839   
  

 

 

    

 

 

 


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

 

                                                 
     Six Months Ended  
     March 28,
2015
     March 29,
2014
 

Cash and cash equivalents, beginning of the period

   $ 13,844       $ 14,259   
  

 

 

    

 

 

 

Operating activities:

Net income

  31,593      23,295   

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

Depreciation and amortization

  5,054      4,031   

Share-based compensation expense

  1,815      1,377   

Deferred income tax expense

  1,879      2,059   

Changes in operating assets and liabilities:

Accounts receivable, net

  6,555      3,401   

Inventories

  (285   (65

Vendor non-trade receivables

  2,500      1,419   

Other current and non-current assets

  2,448      14   

Accounts payable

  (5,428   (2,375

Deferred revenue

  993      1,414   

Other current and non-current liabilities

  5,679      1,638   
  

 

 

    

 

 

 

Cash generated by operating activities

  52,803      36,208   
  

 

 

    

 

 

 

Investing activities:

Purchases of marketable securities

  (92,523   (90,360

Proceeds from maturities of marketable securities

  5,871      10,869   

Proceeds from sales of marketable securities

  48,924      80,241   

Payments made in connection with business acquisitions, net

  (115   (559

Payments for acquisition of property, plant and equipment

  (5,586   (3,367

Payments for acquisition of intangible assets

  (155   (163

Other

  88      (23
  

 

 

    

 

 

 

Cash used in investing activities

  (43,496   (3,362
  

 

 

    

 

 

 

Financing activities:

Proceeds from issuance of common stock

  309      341   

Excess tax benefits from equity awards

  357      363   

Taxes paid related to net share settlement of equity awards

  (608   (430

Dividends and dividend equivalents paid

  (5,544   (5,430

Repurchase of common stock

  (12,000   (23,000

Proceeds from issuance of long-term debt, net

  11,332      0   

Repayments of commercial paper, net

  (2,508   0   
  

 

 

    

 

 

 

Cash used in financing activities

  (8,662   (28,156
  

 

 

    

 

 

 

Increase in cash and cash equivalents

  645      4,690   
  

 

 

    

 

 

 

Cash and cash equivalents, end of the period

$ 14,489    $ 18,949   
  

 

 

    

 

 

 

Supplemental cash flow disclosure:

Cash paid for income taxes, net

$ 7,058    $ 5,369   

Cash paid for interest

$ 220    $ 161   

Exhibit 99.2

Apple Inc.

Q2 2015 Unaudited Summary Data

(Units in thousands, Revenue in millions)

 

                                                                                                                                                                                             
  Q2’15   Q1’15   Q2’14   Sequential Change   Year/Year Change  
      Revenue       Revenue       Revenue       Revenue       Revenue  

Operating Segments

 

Americas

$ 21,316    $ 30,566    $ 17,982      - 30%      19%   

Europe

  12,204      17,214      10,941      - 29%      12%   

Greater China

  16,823      16,144      9,835      4%      71%   

Japan

  3,457      5,448      4,047      - 37%      - 15%   

Rest of Asia Pacific  

  4,210      5,227      2,841      - 19%      48%   
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

 

Total Apple

$ 58,010    $ 74,599    $ 45,646      - 22%      27%   
   

 

 

     

 

 

     

 

 

         
           
  Q2’15   Q1’15   Q2’14   Sequential Change   Year/Year Change  
  Units   Revenue   Units   Revenue   Units   Revenue   Units   Revenue   Units   Revenue  

Product Summary

 

iPhone  (1)

  61,170    $ 40,282      74,468    $ 51,182      43,719    $ 26,064      - 18%      - 21%      40%      55%   

iPad  (1)

  12,623      5,428      21,419      8,985      16,350      7,610      - 41%      - 40%      - 23%      - 29%   

Mac  (1)

  4,563      5,615      5,519      6,944      4,136      5,519      - 17%      - 19%      10%      2%   

Services  (2)

  4,996      4,799      4,573      4%      9%   

Other Products  (1)(3)   

  1,689      2,689      1,880      - 37%      - 10%   
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

 

Total Apple

$ 58,010    $ 74,599    $ 45,646      - 22%      27%   
   

 

 

     

 

 

     

 

 

         
           

 

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

 

(2) Includes revenue from the iTunes Store, App Store, Mac App Store, iBooks Store, AppleCare, Apple Pay, licensing and other services.

 

(3) Includes sales of iPod, Apple TV, Beats Electronics and Apple-branded and third-party accessories.