Tuesday, April 24, 2012

Apple Reports Second Quarter Results - MarketWatch (press release)

CUPERTINO, Calif., Apr 24, 2012 (BUSINESS WIRE) -- --Net Profit Increases 94% Year-over-Year

Apple(R) today announced financial results for its fiscal 2012 second quarter ended March 31, 2012. The Company posted quarterly revenue of $39.2 billion and quarterly net profit of $11.6 billion, or $12.30 per diluted share. These results compare to revenue of $24.7 billion and net profit of $6.0 billion, or $6.40 per diluted share, in the year-ago quarter. Gross margin was 47.4 percent compared to 41.4 percent in the year-ago quarter. International sales accounted for 64 percent of the quarter's revenue.

The Company sold 35.1 million iPhones in the quarter, representing 88 percent unit growth over the year-ago quarter. Apple sold 11.8 million iPads during the quarter, a 151 percent unit increase over the year-ago quarter. The Company sold 4 million Macs during the quarter, a 7 percent unit increase over the year-ago quarter. Apple sold 7.7 million iPods, a 15 percent unit decline from the year-ago quarter.

"We're thrilled with sales of over 35 million iPhones and almost 12 million iPads in the March quarter," said Tim Cook, Apple's CEO. "The new iPad is off to a great start, and across the year you're going to see a lot more of the kind of innovation that only Apple can deliver."

"Our record March quarter results drove $14 billion in cash flow from operations," said Peter Oppenheimer, Apple's CFO. "Looking ahead to the third fiscal quarter, we expect revenue of about $34 billion and diluted earnings per share of about $8.68."

Apple will provide live streaming of its Q2 2012 financial results conference call beginning at 2:00 p.m. PDT on April 24, 2012 at www.apple.com/quicktime/qtv/earningsq212 . 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 diluted 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 24, 2011, its Form 10-Q for the fiscal quarter ended December 31, 2011, and its Form 10-Q for the fiscal quarter ended March 31, 2012 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.

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.

(C) 2012 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           Six Months Ended                                                                     --------------------------- ---------------------------                                                                       March 31,     March 26,     March 31,     March 26,                                                                         2012          2011          2012          2011                                                                     -----------   -----------   -----------   -----------          Net sales                                                     $  39,186     $  24,667     $  85,519     $  51,408          Cost of sales (1)                                                20,622        14,449        46,252        30,892                                                                          -------       -------       -------       -------            Gross margin                                                   18,564        10,218        39,267        20,516                                                                          -------       -------       -------       -------          Operating expenses:            Research and development (1)                                      841           581         1,599         1,156            Selling, general and administrative (1)                         2,339         1,763         4,944         3,659                                                                          -------       -------       -------       -------                Total operating expenses                                    3,180         2,344         6,543         4,815                                                                          -------       -------       -------       -------          Operating income                                                 15,384         7,874        32,724        15,701          Other income and expense                                            148            26           285           162                                                                          -------       -------       -------       -------          Income before provision for income taxes                         15,532         7,900        33,009        15,863          Provision for income taxes                                        3,910         1,913         8,323         3,872                                                                          -------       -------       -------       -------          Net income                                                    $  11,622     $   5,987     $  24,686     $  11,991                                                                          =======       =======       =======       =======          Earnings per common share:            Basic                                                       $   12.45     $    6.49     $   26.48     $   13.02            Diluted                                                     $   12.30     $    6.40     $   26.17     $   12.83          Shares used in computing earnings per share:            Basic                                                         933,582       923,196       932,265       921,245            Diluted                                                       944,893       935,944       943,185       934,549          (1) Includes stock-based compensation expense as follows:            Cost of sales                                               $      63     $      51     $     126     $     103            Research and development                                    $     168     $     104     $     328     $     217            Selling, general and administrative                         $     193     $     132     $     390     $     266                
                                                                 Apple Inc.                                           UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS                                    (In millions, except number of shares which are reflected in                                                             thousands)                                                                                     March 31, 2012     September 24, 2011                                                                                  ------------------   ------------------                                                               ASSETS:          Current assets:            Cash and cash equivalents                                                     $    10,121          $     9,815            Short-term marketable securities                                                   18,417               16,137            Accounts receivable, less allowances of $83 and $53, respectively                   7,042                5,369            Inventories                                                                         1,102                  776            Deferred tax assets                                                                 2,253                2,014            Vendor non-trade receivables                                                        6,727                6,348            Other current assets                                                                5,050                4,529                                                                                            ---------            ---------              Total current assets                                                             50,712               44,988          Long-term marketable securities                                                      81,638               55,618          Property, plant and equipment, net                                                    8,847                7,777          Goodwill                                                                              1,141                  896          Acquired intangible assets, net                                                       3,604                3,536          Other assets                                                                          4,992                3,556                                                                                            ---------            ---------              Total assets                                                                $   150,934          $   116,371                                                                                            =========            =========                                  LIABILITIES AND SHAREHOLDERS' EQUITY:          Current liabilities:            Accounts payable                                                              $    17,011          $    14,632            Accrued expenses                                                                    9,778                9,247            Deferred revenue                                                                    5,247                4,091                                                                                            ---------            ---------              Total current liabilities                                                        32,036               27,970          Deferred revenue - non-current                                                        2,446                1,686          Other non-current liabilities                                                        13,954               10,100                                                                                            ---------            ---------              Total liabilities                                                                48,436               39,756                                                                                            ---------            ---------          Commitments and contingencies          Shareholders' equity:            Common stock, no par value; 1,800,000 shares authorized; 934,982 and               14,850               13,331            929,277 shares issued and outstanding, respectively            Retained earnings                                                                  87,124               62,841            Accumulated other comprehensive income                                                524                  443                                                                                            ---------            ---------              Total shareholders' equity                                                      102,498               76,615                                                                                            ---------            ---------              Total liabilities and shareholders' equity                                  $   150,934          $   116,371                                                                                            =========            =========                
                                                              Apple Inc.                                   UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS                                                         (In millions)                                                                                          Six Months Ended                                                                                 -----------------------------------                                                                                  March 31, 2012    March 26, 2011                                                                                 ----------------- -----------------          Cash and cash equivalents, beginning of the period                          $   9,815         $  11,261                                                                                        -------           -------          Operating activities:            Net income                                                                   24,686            11,991            Adjustments to reconcile net income to cash generated by operating            activities:               Depreciation, amortization and accretion                                   1,461               790               Share-based compensation expense                                             844               586               Deferred income tax expense                                                2,915             1,563            Changes in operating assets and liabilities:               Accounts receivable, net                                                  (1,663)            (288)               Inventories                                                                 (326)             121               Vendor non-trade receivables                                                (379)            (883)               Other current and non-current assets                                      (1,510)          (1,886)               Accounts payable                                                           2,809             1,626               Deferred revenue                                                           1,916               698               Other current and non-current liabilities                                    778             1,674                                                                                        -------           -------                 Cash generated by operating activities                                  31,531            15,992                                                                                        -------           -------          Investing activities:            Purchases of marketable securities                                          (85,022)         (42,260)            Proceeds from maturities of marketable securities                             7,702            10,211            Proceeds from sales of marketable securities                                 49,052            21,705            Payments made in connection with business acquisitions, net of cash            (350)               0            acquired            Payments for acquisition of property, plant and equipment                    (2,778)          (1,838)            Payments for acquisition of intangible assets                                  (160)             (81)            Other                                                                           (48)              12                                                                                        ------- -         -------                 Cash used in investing activities                                      (31,604)         (12,251)                                                                                        ------- -         ------- -          Financing activities:            Proceeds from issuance of common stock                                          377               494            Excess tax benefits from equity awards                                          636               740            Taxes paid related to net share settlement of equity awards                    (634)            (258)                                                                                        ------- -         ------- -                 Cash generated by financing activities                                     379               976                                                                                        -------           -------          Increase in cash and cash equivalents                                             306             4,717                                                                                        -------           -------          Cash and cash equivalents, end of the period                                $  10,121         $  15,978                                                                                        =======           =======          Supplemental cash flow disclosure:            Cash paid for income taxes, net                                           $   4,835         $   1,913                
                                                                                               Apple Inc.                                                                                 Q2 2012 Unaudited Summary Data                                                                            (Units in thousands, Revenue in millions)                                                                                Q1 2012                Q2 2011                Q2 2012                                                                        ---------------------- ---------------------- ----------------------                                                                                                                                               Sequential Change    Year/Year Change                                                                                                                                             -------------------- --------------------          Operating Segments                                             Mac Units   Revenue    Mac Units   Revenue    Mac Units   Revenue    Mac Units  Revenue   Mac Units  Revenue                                                                        ---------  ----------- ---------  ----------- ---------  ----------- ---------- --------- ---------- ---------                       Americas                                             1,612    $ 17,714      1,217    $  9,323      1,214    $ 13,182  - 25 %     - 26 %       0 %       41 %                       Europe                                               1,482      11,256        995       6,027      1,048       8,807  - 29 %     - 22 %       5 %       46 %                       Japan                                                  184       3,550        155       1,383        158       2,645  - 14 %     - 25 %       2 %       91 %                       Asia Pacific                                           814       7,697        596       4,743        771      10,153   - 5 %       32 %      29 %      114 %                       Retail                                               1,106       6,116        797       3,191        826       4,399  - 25 %     - 28 %       4 %       38 %                                                                        ---------      ------  ---------      ------  ---------      ------          Total Operating Segments                                          5,198    $ 46,333      3,760    $ 24,667      4,017    $ 39,186  - 23 %     - 15 %       7 %       59 %                                                                        =========  === ======  =========  === ======  =========  === ======                                                                                                                                               Sequential Change    Year/Year Change                                                                                                                                             -------------------- --------------------          Product Summary                                                  Units     Revenue      Units     Revenue      Units     Revenue      Units    Revenue     Units    Revenue                                                                        ---------  ----------- ---------  ----------- ---------  ----------- ---------- --------- ---------- ---------                       Mac Desktops (1)(9)                                  1,479    $  1,936      1,009    $  1,441      1,199    $  1,563  - 19 %     - 19 %      19 %        8 %                       Mac Portables (2)(9)                                 3,719       4,662      2,751       3,535      2,818       3,510  - 24 %     - 25 %       2 %      - 1 %                                                                        ---------      ------  ---------      ------  ---------      ------          Subtotal Mac                                                      5,198       6,598      3,760       4,976      4,017       5,073  - 23 %     - 23 %       7 %        2 %                       iPod (3)(9)                                         15,397       2,528      9,017       1,600      7,673       1,207  - 50 %     - 52 %    - 15 %     - 25 %                       Other Music Related Products and Services (4)                    2,027                  1,634                  2,151                6 %                 32 %                       iPhone and Related Products and Services (5)(9)     37,044      24,417     18,647      12,298     35,064      22,690   - 5 %      - 7 %      88 %       85 %                       iPad and Related Products and Services (6)(9)       15,434       9,153      4,694       2,836     11,798       6,590  - 24 %     - 28 %     151 %      132 %                       Peripherals and Other Hardware (7)                                 766                    580                    643             - 16 %                 11 %                       Software, Service and Other Sales (8)                              844                    743                    832              - 1 %                 12 %                                                                                       ------                 ------                 ------          Total Apple                                                                $ 46,333               $ 24,667               $ 39,186             - 15 %                 59 %                                                                                   === ======             === ======             === ======                   (1)  Includes revenue from iMac, Mac mini, and Mac Pro sales.                   (2)  Includes revenue from MacBook, MacBook Air, and MacBook Pro sales.                   (3)  Includes revenue from iPod sales.                   (4)  Includes revenue from sales from the iTunes Store, App Store, and                        iBookstore in addition to sales of iPod services and Apple-branded                        and third-party iPod accessories.                   (5)  Includes revenue from sales of iPhone, iPhone services, and                        Apple-branded and third-party iPhone accessories.                   (6)  Includes revenue from sales of iPad, iPad services, and                        Apple-branded and third-party iPad accessories.                   (7)  Includes revenue from sales of displays, networking product, and                        other hardware.                   (8)  Includes revenue from sales of Apple-branded and third-party Mac                        software, and services.                   (9)  Includes amortization of related revenue deferred for non-software                        services and embedded software upgrade rights.                

SOURCE: Apple

                        Apple           Steve Dowling, 408-974-1896 (Press)           dowling@apple.com           Nancy Paxton, 408-974-5420 (Investor Relations)           paxton1@apple.com           Joan Hoover, 408-974-4570 (Investor Relations)           hoover1@apple.com                

Copyright Business Wire 2012

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