Apple
APPLE INC (Form: 8-K, Received: 10/27/2015 16:32:00)

 

 

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 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 October 27, 2015, Apple Inc. (“Apple”) issued a press release regarding Apple’s financial results for its fourth fiscal quarter ended September 26, 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 October 27, 2015.
99.2    Data sheet issued by Apple Inc. on October 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: October 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 October 27, 2015.
99.2    Data sheet issued by Apple Inc. on October 27, 2015.

Exhibit 99.1

Apple Reports Record Fourth Quarter Results

iPhone, Apple Watch & App Store Drive Revenue Growth of 22%

CUPERTINO, California — October 27, 2015 — Apple ® today announced financial results for its fiscal 2015 fourth quarter ended September 26, 2015. The Company posted quarterly revenue of $51.5 billion and quarterly net profit of $11.1 billion, or $1.96 per diluted share. These results compare to revenue of $42.1 billion and net profit of $8.5 billion, or $1.42 per diluted share, in the year-ago quarter. Gross margin was 39.9 percent compared to 38 percent in the year-ago quarter. International sales accounted for 62 percent of the quarter’s revenue.

The growth was fueled by record fourth quarter sales of iPhone ® , the expanded availability of Apple Watch ® , and all-time records for Mac ® sales and revenue from services.

“Fiscal 2015 was Apple’s most successful year ever, with revenue growing 28% to nearly $234 billion. This continued success is the result of our commitment to making the best, most innovative products on earth, and it’s a testament to the tremendous execution by our teams,” said Tim Cook, Apple’s CEO. “We are heading into the holidays with our strongest product lineup yet, including iPhone 6s and iPhone 6s Plus, Apple Watch with an expanded lineup of cases and bands, the new iPad Pro and the all-new Apple TV which begins shipping this week.”

“Apple’s record September quarter results drove earnings per share growth of 38% and operating cash flow of $13.5 billion,” said Luca Maestri, Apple’s CFO. “We returned $17 billion to our investors during the quarter through share repurchases and dividends, and we have now completed over $143 billion of our $200 billion capital return program.”

Apple is providing the following guidance for its fiscal 2016 first quarter:

 

  revenue between $75.5 billion and $77.5 billion

 

  gross margin between 39 percent and 40 percent

 

  operating expenses between $6.3 billion and $6.4 billion

 

  other income/(expense) of $400 million

 

  tax rate of 26.2 percent

Apple’s board of directors has declared a cash dividend of $.52 per share of the Company’s common stock. The dividend is payable on November 12, 2015, to shareholders of record as of the close of business on November 9, 2015.

Apple will provide live streaming of its Q4 2015 financial results conference call beginning at 2:00 p.m. PDT on October 27, 2015 at www.apple.com/quicktime/qtv/earningsq415. 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, its Form 10-Q for the fiscal quarter ended March 28, 2015, its Form 10-Q for the fiscal quarter ended June 27, 2015, and its Form 10-K for the fiscal year ended September 26, 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 revolutionized personal technology with the introduction of the Macintosh in 1984. Today, Apple leads the world in innovation with iPhone, iPad, the Mac and Apple Watch. Apple’s three software platforms — iOS, OS X and watchOS — provide seamless experiences across all Apple devices and empower people with breakthrough services including the App Store, Apple Music, Apple Pay and iCloud. Apple’s 100,000 employees are dedicated to making the best products on earth, and to leaving the world better than we found it.

Press Contact:

Kristin Huguet

Apple

khuguet@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, iPhone, Apple Watch and Mac 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 26,
2015
     September 27,
2014
     September 26,
2015
     September 27,
2014
 

Net sales

   $ 51,501       $ 42,123       $ 233,715       $ 182,795   

Cost of sales (1)

     30,953         26,114         140,089         112,258   
  

 

 

    

 

 

    

 

 

    

 

 

 

Gross margin

     20,548         16,009         93,626         70,537   
  

 

 

    

 

 

    

 

 

    

 

 

 

Operating expenses:

           

Research and development (1)

     2,220         1,686         8,067         6,041   

Selling, general and administrative (1)

     3,705         3,158         14,329         11,993   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total operating expenses

     5,925         4,844         22,396         18,034   
  

 

 

    

 

 

    

 

 

    

 

 

 

Operating income

     14,623         11,165         71,230         52,503   

Other income/(expense), net

     439         307         1,285         980   
  

 

 

    

 

 

    

 

 

    

 

 

 

Income before provision for income taxes

     15,062         11,472         72,515         53,483   

Provision for income taxes

     3,938         3,005         19,121         13,973   
  

 

 

    

 

 

    

 

 

    

 

 

 

Net income

   $ 11,124       $ 8,467       $ 53,394       $ 39,510   
  

 

 

    

 

 

    

 

 

    

 

 

 

Earnings per share:

           

Basic

   $ 1.97       $ 1.43       $ 9.28       $ 6.49   

Diluted

   $ 1.96       $ 1.42       $ 9.22       $ 6.45   

Shares used in computing earnings per share:

           

Basic

     5,646,916         5,933,845         5,753,421         6,085,572   

Diluted

     5,682,519         5,972,082         5,793,069         6,122,663   

Cash dividends declared per share

   $ 0.52       $ 0.47       $ 1.98       $ 1.82   
(1)  Includes share-based compensation expense as follows:            

Cost of sales

   $ 145       $ 116       $ 575       $ 450   

Research and development

   $ 390       $ 314       $ 1,536       $ 1,216   

Selling, general and administrative

   $ 380       $ 332       $ 1,475       $ 1,197   


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

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

 

                                                 
     September 26,
2015
    September 27,
2014
 
ASSETS:   

Current assets:

    

Cash and cash equivalents

   $ 21,120      $ 13,844   

Short-term marketable securities

     20,481        11,233   

Accounts receivable, less allowances of $82 and $86, respectively

     16,849        17,460   

Inventories

     2,349        2,111   

Deferred tax assets

     5,546        4,318   

Vendor non-trade receivables

     13,494        9,759   

Other current assets

     9,539        9,806   
  

 

 

   

 

 

 

Total current assets

     89,378        68,531   

Long-term marketable securities

     164,065        130,162   

Property, plant and equipment, net

     22,471        20,624   

Goodwill

     5,116        4,616   

Acquired intangible assets, net

     3,893        4,142   

Other assets

     5,556        3,764   
  

 

 

   

 

 

 

Total assets

   $ 290,479      $ 231,839   
  

 

 

   

 

 

 
LIABILITIES AND SHAREHOLDERS’ EQUITY:   

Current liabilities:

    

Accounts payable

   $ 35,490      $ 30,196   

Accrued expenses

     25,181        18,453   

Deferred revenue

     8,940        8,491   

Commercial paper

     8,499        6,308   

Current portion of long-term debt

     2,500        0   
  

 

 

   

 

 

 

Total current liabilities

     80,610        63,448   

Deferred revenue, non-current

     3,624        3,031   

Long-term debt

     53,463        28,987   

Other non-current liabilities

     33,427        24,826   
  

 

 

   

 

 

 

Total liabilities

     171,124        120,292   
  

 

 

   

 

 

 

Commitments and contingencies

    

Shareholders’ equity:

    

Common stock and additional paid-in capital, $0.00001 par value: 12,600,000 shares authorized; 5,578,753 and 5,866,161 shares issued and outstanding, respectively

     27,416        23,313   

Retained earnings

     92,284        87,152   

Accumulated other comprehensive income

     (345     1,082   
  

 

 

   

 

 

 

Total shareholders’ equity

     119,355        111,547   
  

 

 

   

 

 

 

Total liabilities and shareholders’ equity

   $ 290,479      $ 231,839   
  

 

 

   

 

 

 


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

 

                                                 
     Twelve Months Ended  
     September 26,
2015
    September 27,
2014
 

Cash and cash equivalents, beginning of the period

   $ 13,844      $ 14,259   
  

 

 

   

 

 

 

Operating activities:

  

Net income

     53,394        39,510   

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

  

Depreciation and amortization

     11,257        7,946   

Share-based compensation expense

     3,586        2,863   

Deferred income tax expense

     1,382        2,347   

Changes in operating assets and liabilities:

  

Accounts receivable, net

     611        (4,232

Inventories

     (238     (76

Vendor non-trade receivables

     (3,735     (2,220

Other current and non-current assets

     (179     167   

Accounts payable

     5,400        5,938   

Deferred revenue

     1,042        1,460   

Other current and non-current liabilities

     8,746        6,010   
  

 

 

   

 

 

 

Cash generated by operating activities

     81,266        59,713   
  

 

 

   

 

 

 

Investing activities:

  

Purchases of marketable securities

     (166,402     (217,128

Proceeds from maturities of marketable securities

     14,538        18,810   

Proceeds from sales of marketable securities

     107,447        189,301   

Payments made in connection with business acquisitions, net

     (343     (3,765

Payments for acquisition of property, plant and equipment

     (11,247     (9,571

Payments for acquisition of intangible assets

     (241     (242

Other

     (26     16   
  

 

 

   

 

 

 

Cash used in investing activities

     (56,274     (22,579
  

 

 

   

 

 

 

Financing activities:

  

Proceeds from issuance of common stock

     543        730   

Excess tax benefits from equity awards

     749        739   

Taxes paid related to net share settlement of equity awards

     (1,499     (1,158

Dividends and dividend equivalents paid

     (11,561     (11,126

Repurchase of common stock

     (35,253     (45,000

Proceeds from issuance of term debt, net

     27,114        11,960   

Change in commercial paper, net

     2,191        6,306   
  

 

 

   

 

 

 

Cash used in financing activities

     (17,716     (37,549
  

 

 

   

 

 

 

Increase/(decrease) in cash and cash equivalents

     7,276        (415
  

 

 

   

 

 

 

Cash and cash equivalents, end of the period

   $ 21,120      $ 13,844   
  

 

 

   

 

 

 

Supplemental cash flow disclosure:

  

Cash paid for income taxes, net

   $ 13,252      $ 10,026   

Cash paid for interest

   $ 514      $ 339   

Exhibit 99.2

Apple Inc.

Q4 2015 Unaudited Summary Data

(Units in thousands, Revenue in millions)

 

                                                                                                                                                                                             
    Q4 2015     Q3 2015     Q4 2014     Sequential Change     Year/Year Change  
          Revenue           Revenue           Revenue           Revenue           Revenue  
Operating Segments                      

Americas

    $ 21,773        $ 20,209        $ 19,750          8%          10%   

Europe

      10,577          10,342          10,350          2%          2%   

Greater China

      12,518          13,230          6,292          - 5%          99%   

Japan

      3,929          2,872          3,595          37%          9%   

Rest of Asia Pacific  

      2,704          2,952          2,136          - 8%          27%   
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

 

Total Apple

    $ 51,501        $ 49,605        $ 42,123          4%          22%   
   

 

 

     

 

 

     

 

 

         
                               
                        
    Q4 2015     Q3 2015     Q4 2014     Sequential Change     Year/Year Change  
    Units     Revenue     Units     Revenue     Units     Revenue     Units     Revenue     Units     Revenue  
Product Summary                      

iPhone (1)

    48,046      $ 32,209        47,534      $ 31,368        39,272      $ 23,678        1%        3%        22%        36%   

iPad (1)

    9,883        4,276        10,931        4,538        12,316        5,316        - 10%        - 6%        - 20%        - 20%   

Mac (1)

    5,709        6,882        4,796        6,030        5,520        6,625        19%        14%        3%        4%   

Services (2)

      5,086          5,028          4,608          1%          10%   

Other Products (1)(3)   

      3,048          2,641          1,896          15%          61%   
   

 

 

     

 

 

     

 

 

     

 

 

     

 

 

 

Total Apple

    $ 51,501        $ 49,605        $ 42,123          4%          22%   
   

 

 

     

 

 

     

 

 

         
                               

 

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

 

(2) Includes revenue from Internet Services, AppleCare, Apple Pay, licensing and other services.

 

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