EX-99.1 2 dex991.htm TEXT OF PRESS RELEASE ISSUED BY APPLE INC. ON OCTOBER 18, 2010 Text of Press Release issued by Apple Inc. on October 18, 2010


Exhibit 99.1

Apple Reports Fourth Quarter Results

Record Mac, iPhone and iPad Sales

Highest Revenue and Earnings Ever

CUPERTINO, California—October 18, 2010—Apple® today announced financial results for its fiscal 2010 fourth quarter ended September 25, 2010. The Company posted record revenue of $20.34 billion and net quarterly profit of $4.31 billion, or $4.64 per diluted share. These results compare to revenue of $12.21 billion and net quarterly profit of $2.53 billion, or $2.77 per diluted share, in the year-ago quarter. Gross margin was 36.9 percent compared to 41.8 percent in the year-ago quarter. International sales accounted for 57 percent of the quarter’s revenue.

Apple sold 3.89 million Macs during the quarter, a 27 percent unit increase over the year-ago quarter. The Company sold 14.1 million iPhones in the quarter, representing 91 percent unit growth over the year-ago quarter. Apple sold 9.05 million iPods during the quarter, representing an 11 percent unit decline from the year-ago quarter. The Company also sold 4.19 million iPads during the quarter.

“We are blown away to report over $20 billion in revenue and over $4 billion in after-tax earnings—both all-time records for Apple,” said Steve Jobs, Apple’s CEO. “iPhone sales of 14.1 million were up 91 percent year-over-year, handily beating the 12.1 million phones RIM sold in their most recent quarter. We still have a few surprises left for the remainder of this calendar year.”

“We’re thrilled with the performance and strength of our business, generating almost $5.7 billion in cash flow from operations during the quarter,” said Peter Oppenheimer, Apple’s CFO. “Looking ahead to the first fiscal quarter of 2011, we expect revenue of about $23 billion and we expect diluted earnings per share of about $4.80.”

Apple will provide live streaming of its Q4 2010 financial results conference call beginning at 2:00 p.m. PDT on October 18, 2010 at www.apple.com/quicktime/qtv/earningsq410/. 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; the Company’s reliance on the availability of third-party 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 Company’s reliance on sole service providers for iPhone® in certain countries; 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; potential litigation from the matters investigated by the special committee of the board of directors and the restatement of the Company’s consolidated financial statements; 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 Company’s public reports filed with the SEC, including the Company’s Form 10-K, as amended, for the fiscal year ended September 26, 2009, its Forms 10-Q for the quarters ended December 26, 2009; March 27, 2010; and June 26, 2010; and its Form 10-K for the fiscal year ended September 25, 2010 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 is reinventing the mobile phone with its revolutionary iPhone and App Store, and has recently introduced its magical iPad which is defining the future of mobile media and computing devices.

Press Contact:

Steve Dowling



(408) 974-1896

Investor Relations Contacts:

Nancy Paxton



(408) 974-5420

Joan Hoover



(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.

© 2010 Apple Inc. All rights reserved. Apple, the Apple logo, Mac, Mac OS, Macintosh and iPhone are trademarks of Apple. Other company and product names may be trademarks of their respective owners.


Apple Inc.


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


     Three Months Ended      Twelve Months Ended  
     September  25,
     September  26,
     September  25,
     September  26,

Net sales

   $ 20,343       $ 12,207       $ 65,225       $ 42,905   

Cost of sales (1)

     12,831         7,102         39,541         25,683   

Gross margin

     7,512         5,105         25,684         17,222   

Operating expenses:


Research and development (1)

     494         358         1,782         1,333   

Selling, general and administrative (1)

     1,571         1,063         5,517         4,149   

Total operating expenses

     2,065         1,421         7,299         5,482   

Operating income

     5,447         3,684         18,385         11,740   

Other income and expense

     14         45         155         326   

Income before provision for income taxes

     5,461         3,729         18,540         12,066   

Provision for income taxes

     1,153         1,197         4,527         3,831   

Net income

   $ 4,308       $ 2,532       $ 14,013       $ 8,235   

Earnings per common share:



   $ 4.71       $ 2.82       $ 15.41       $ 9.22   


   $ 4.64       $ 2.77       $ 15.15       $ 9.08   

Shares used in computing earnings per share:



     914,555         898,032         909,461         893,016   


     928,825         914,374         924,712         907,005   
(1) Includes stock-based compensation expense as follows:            

Cost of sales

   $ 39       $ 29       $ 151       $ 114   

Research and development

   $ 83       $ 66       $ 323       $ 258   

Selling, general and administrative

   $ 102       $ 85       $ 405       $ 338   


Apple Inc.


(In millions, except share amounts)


     September 25,
    September 26,

Current assets:


Cash and cash equivalents

   $ 11,261      $ 5,263   

Short-term marketable securities

     14,359        18,201   

Accounts receivable, less allowances of $55 and $52, respectively

     5,510        3,361   


     1,051        455   

Deferred tax assets

     1,636        1,135   

Vendor non-trade receivables

     4,414        1,696   

Other current assets

     3,447        1,444   

Total current assets

     41,678        31,555   

Long-term marketable securities

     25,391        10,528   

Property, plant and equipment, net

     4,768        2,954   


     741        206   

Acquired intangible assets, net

     342        247   

Other assets

     2,263        2,011   

Total assets

   $ 75,183      $ 47,501   

Current liabilities:


Accounts payable

   $ 12,015      $ 5,601   

Accrued expenses

     5,723        3,852   

Deferred revenue

     2,984        2,053   

Total current liabilities

     20,722        11,506   

Deferred revenue – non-current

     1,139        853   

Other non-current liabilities

     5,531        3,502   

Total liabilities

     27,392        15,861   

Commitments and contingencies


Shareholders’ equity:


Common stock, no par value; 1,800,000,000 shares authorized; 915,970,050 and 899,805,500 shares issued and outstanding, respectively

     10,668        8,210   

Retained earnings

     37,169        23,353   

Accumulated other comprehensive (loss)/income

     (46     77   

Total shareholders’ equity

     47,791        31,640   

Total liabilities and shareholders’ equity

   $ 75,183      $ 47,501   

Apple Inc.


(In millions)


     Twelve Months Ended  
     September 25,
    September 26,

Cash and cash equivalents, beginning of the year

   $ 5,263      $ 11,875   

Operating activities:


Net income

     14,013        8,235   

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


Depreciation, amortization and accretion

     1,027        734   

Stock-based compensation expense

     879        710   

Deferred income tax expense

     1,440        1,040   

Loss on disposition of property, plant and equipment

     24        26   

Changes in operating assets and liabilities:


Accounts receivable, net

     (2,142     (939


     (596     54   

Vendor non-trade receivables

     (2,718     586   

Other current assets

     (1,514     163   

Other assets

     (120     (902

Accounts payable

     6,307        92   

Deferred revenue

     1,217        521   

Other liabilities

     778        (161

Cash generated by operating activities

     18,595        10,159   

Investing activities:


Purchases of marketable securities

     (57,793     (46,724

Proceeds from maturities of marketable securities

     24,930        19,790   

Proceeds from sales of marketable securities

     21,788        10,888   

Purchases of other long-term investments

     (18     (101

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

     (638     0   

Payments for acquisition of property, plant and equipment

     (2,005     (1,144

Payments for acquisition of intangible assets

     (116     (69


     (2     (74

Cash used in investing activities

     (13,854     (17,434

Financing activities:


Proceeds from issuance of common stock

     912        475   

Excess tax benefits from stock-based compensation

     751        270   

Taxes paid related to net share settlement of equity awards

     (406     (82

Cash generated by financing activities

     1,257        663   

Increase/(decrease) in cash and cash equivalents

     5,998        (6,612

Cash and cash equivalents, end of the year

   $ 11,261      $ 5,263   

Supplemental cash flow disclosure:


Cash paid for income taxes, net

   $ 2,697      $ 2,997