EX-99.1 2 dex991.htm TEXT OF PRESS RELEASE ISSUED BY APPLE INC. ON APRIL 20, 2011 Text of press release issued by Apple Inc. on April 20, 2011

Exhibit 99.1

Apple Reports Second Quarter Results

Record March Quarter Drives 83 Percent Revenue Growth, 95 Percent Profit Growth

Record iPhone Sales Grow 113 Percent

CUPERTINO, California—April 20, 2011—Apple® today announced financial results for its fiscal 2011 second quarter ended March 26, 2011. The Company posted record second quarter revenue of $24.67 billion and record second quarter net profit of $5.99 billion, or $6.40 per diluted share. These results compare to revenue of $13.50 billion and net quarterly profit of $3.07 billion, or $3.33 per diluted share, in the year-ago quarter. Gross margin was 41.4 percent compared to 41.7 percent in the year-ago quarter. International sales accounted for 59 percent of the quarter’s revenue.

Apple sold 3.76 million Macs during the quarter, a 28 percent unit increase over the year-ago quarter. The Company sold 18.65 million iPhones in the quarter, representing 113 percent unit growth over the year-ago quarter. Apple sold 9.02 million iPods during the quarter, representing a 17 percent unit decline from the year-ago quarter. The Company also sold 4.69 million iPads during the quarter.

“With quarterly revenue growth of 83 percent and profit growth of 95 percent, we’re firing on all cylinders,” said Steve Jobs, Apple’s CEO. “We will continue to innovate on all fronts throughout the remainder of the year.”

“We are extremely pleased with our record March quarter revenue and earnings and cash flow from operations of over $6.2 billion,” said Peter Oppenheimer, Apple’s CFO. “Looking ahead to the third fiscal quarter of 2011, we expect revenue of about $23 billion and we expect diluted earnings per share of about $5.03.”

Apple will provide live streaming of its Q2 2011 financial results conference call beginning at 2:00 p.m. PDT on April 20, 2011 at www.apple.com/quicktime/qtv/earningsq211. 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; 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 25, 2010, its Form 10-Q for the quarter ended December 25, 2010, and its Form 10-Q for the quarter ended March 26, 2011 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 has recently introduced iPad 2 which is defining the future of mobile media and computing devices.

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.

© 2011 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 share amounts which are reflected in thousands and per share amounts)

 

     Three Months Ended      Six Months Ended  
     March 26,
2011
     March 27,
2010
     March 26,
2011
     March 27,
2010
 

Net sales

   $ 24,667       $ 13,499       $ 51,408       $ 29,182   

Cost of sales (1)

     14,449         7,874         30,892         17,146   
                                   

Gross margin

     10,218         5,625         20,516         12,036   
                                   

Operating expenses:

           

Research and development (1)

     581         426         1,156         824   

Selling, general and administrative (1)

     1,763         1,220         3,659         2,508   
                                   

Total operating expenses

     2,344         1,646         4,815         3,332   
                                   

Operating income

     7,874         3,979         15,701         8,704   

Other income and expense

     26         50         162         83   
                                   

Income before provision for income taxes

     7,900         4,029         15,863         8,787   

Provision for income taxes

     1,913         955         3,872         2,335   
                                   

Net income

   $ 5,987       $ 3,074       $ 11,991       $ 6,452   
                                   

Earnings per common share:

           

Basic

   $ 6.49       $ 3.39       $ 13.02       $ 7.12   

Diluted

   $ 6.40       $ 3.33       $ 12.83       $ 7.00   

Shares used in computing earnings per share:

           

Basic

     923,196         907,548         921,245         905,545   

Diluted

     935,944         922,878         934,549         921,331   

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

           

Cost of sales

   $ 51       $ 37       $ 103       $ 74   

Research and development

   $ 104       $ 86       $ 217       $ 160   

Selling, general and administrative

   $ 132       $ 108       $ 266       $ 202   


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except share amounts)

 

     March 26,
2011
     September 25,
2010
 
ASSETS:      

Current assets:

     

Cash and cash equivalents

   $ 15,978       $ 11,261   

Short-term marketable securities

     13,256         14,359   

Accounts receivable, less allowances of $57 and $55, respectively

     5,798         5,510   

Inventories

     930         1,051   

Deferred tax assets

     1,683         1,636   

Vendor non-trade receivables

     5,297         4,414   

Other current assets

     4,055         3,447   
                 

Total current assets

     46,997         41,678   

Long-term marketable securities

     36,533         25,391   

Property, plant and equipment, net

     6,241         4,768   

Goodwill

     741         741   

Acquired intangible assets, net

     507         342   

Other assets

     3,885         2,263   
                 

Total assets

   $ 94,904       $ 75,183   
                 
LIABILITIES AND SHAREHOLDERS’ EQUITY:      

Current liabilities:

     

Accounts payable

   $ 13,714       $ 12,015   

Accrued expenses

     7,022         5,723   

Deferred revenue

     3,591         2,984   
                 

Total current liabilities

     24,327         20,722   

Deferred revenue – non-current

     1,230         1,139   

Other non-current liabilities

     7,870         5,531   
                 

Total liabilities

     33,427         27,392   
                 

Commitments and contingencies

     

Shareholders’ equity:

     

Common stock, no par value; 1,800,000,000 shares authorized; 924,674,079 and 915,970,050 shares issued and outstanding, respectively

     12,326         10,668   

Retained earnings

     49,025         37,169   

Accumulated other comprehensive income/(loss)

     126         (46
                 

Total shareholders’ equity

     61,477         47,791   
                 

Total liabilities and shareholders’ equity

   $ 94,904       $ 75,183   
                 


Apple Inc.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

 

     Six Months Ended  
     March 26,
2011
    March 27,
2010
 

Cash and cash equivalents, beginning of the period

   $ 11,261      $ 5,263   
                

Operating activities:

    

Net income

     11,991        6,452   

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

    

Depreciation, amortization and accretion

     790        425   

Stock-based compensation expense

     586        436   

Deferred income tax expense

     1,563        893   

Changes in operating assets and liabilities:

    

Accounts receivable, net

     (288     482   

Inventories

     121        (183

Vendor non-trade receivables

     (883     (47

Other current and non-current assets

     (1,886     (619

Accounts payable

     1,626        (18

Deferred revenue

     698        577   

Other current and non-current liabilities

     1,674        (287
                

Cash generated by operating activities

     15,992        8,111   
                

Investing activities:

    

Purchases of marketable securities

     (42,260     (25,061

Proceeds from maturities of marketable securities

     10,211        13,331   

Proceeds from sales of marketable securities

     21,705        8,686   

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

     0        (325

Payments for acquisition of property, plant and equipment

     (1,838     (650

Payments for acquisition of intangible assets

     (81     (32

Other

     12        10   
                

Cash used in investing activities

     (12,251     (4,041
                

Financing activities:

    

Proceeds from issuance of common stock

     494        534   

Excess tax benefits from equity awards

     740        413   

Taxes paid related to net share settlement of equity awards

     (258     (262
                

Cash generated by financing activities

     976        685   
                

Increase in cash and cash equivalents

     4,717        4,755   
                

Cash and cash equivalents, end of the period

   $ 15,978      $ 10,018   
                

Supplemental cash flow disclosure:

    

Cash paid for income taxes, net

   $ 1,913      $ 2,144