Apple posts record revenue and earnings, 20+M iPhones, 9.25M iPads, 4M Macs

Seth Weintraub | Jul 19 2011 - 1:33 pm PT

Apple lined up another record quarter (shocker) selling an incredible 20.34 million iPhones, 9.25 million iPads and 3.95 million Macs. iPods were down 20% YOY to 7.9M. The company earned $7.31 billion in net profit on revenue of $28.57 billion for the June quarter. Both are records for Apple…and it isn’t even a holiday quarter.

“We’re thrilled to deliver our best quarter ever, with revenue up 82 percent and profits up 125 percent,” said Steve Jobs, Apple’s CEO. “Right now, we’re very focused and excited about bringing iOS 5 and iCloud to our users this fall.”

Press release and charts follow:

Apple Reports Third Quarter Results

All-Time Record Revenue and Earnings

iPhone Sales Grow 142 Percent; iPad Sales Grow 183 Percent

CUPERTINO, Calif.–(BUSINESS WIRE)–Apple® today announced financial results for its fiscal 2011 third quarter ended June 25, 2011. The Company posted record quarterly revenue of $28.57 billion and record quarterly net profit of $7.31 billion, or $7.79 per diluted share. These results compare to revenue of $15.70 billion and net quarterly profit of $3.25 billion, or $3.51 per diluted share, in the year-ago quarter. Gross margin was 41.7 percent compared to 39.1 percent in the year-ago quarter. International sales accounted for 62 percent of the quarter’s revenue.

“Right now, we’re very focused and excited about bringing iOS 5 and iCloud to our users this fall.”

The Company sold 20.34 million iPhones in the quarter, representing 142 percent unit growth over the year-ago quarter. Apple sold 9.25 million iPads during the quarter, a 183 percent unit increase over the year-ago quarter. The Company sold 3.95 million Macs during the quarter, a 14 percent unit increase over the year-ago quarter. Apple sold 7.54 million iPods, a 20 percent unit decline from the year-ago quarter.

“We’re thrilled to deliver our best quarter ever, with revenue up 82 percent and profits up 125 percent,” said Steve Jobs, Apple’s CEO. “Right now, we’re very focused and excited about bringing iOS 5 and iCloud to our users this fall.”

“We are extremely pleased with our performance which drove quarterly cash flow from operations of $11.1 billion, an increase of 131 percent year-over-year,” said Peter Oppenheimer, Apple’s CFO. “Looking ahead to the fourth fiscal quarter of 2011, we expect revenue of about $25 billion and we expect diluted earnings per share of about $5.50.”

Apple will provide live streaming of its Q3 2011 financial results conference call beginning at 2:00 p.m. PDT on July 19, 2011 at www.apple.com/quicktime/qtv/earningsq311. This webcast will also be available for replay for approximately two weeks thereafter.

This press release contains forward-looking statements [blah blah…]

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.

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.


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				Nine Months Ended
	June 25, 2011		June 26,2010		June 25, 2011		June 26,2010

Net sales	$	28,571	$	15,700	$	79,979	$	44,882
Cost of sales ⁽¹⁾		16,649		9,564		47,541		26,710

Gross margin		11,922		6,136		32,438		18,172

Operating expenses:
Research and development ⁽¹⁾		628		464		1,784		1,288
Selling, general and administrative ⁽¹⁾		1,915		1,438		5,574		3,946

Total operating expenses		2,543		1,902		7,358		5,234

Operating income		9,379		4,234		25,080		12,938

Other income and expense		172		58		334		141

Income before provision for income taxes		9,551		4,292		25,414		13,079

Provision for income taxes		2,243		1,039		6,115		3,374

Net income	$	7,308	$	3,253	$	19,299	$	9,705

Earnings per common share:
Basic	$	7.89	$	3.57	$	20.91	$	10.69
Diluted	$	7.79	$	3.51	$	20.63	$	10.51

Shares used in computing earnings per share:
Basic		926,108		912,197		922,917		907,762
Diluted		937,810		927,361		935,688		923,341

⁽¹⁾ Includes stock-based compensation expense as follows:
Cost of sales	$	52	$	38	$	155	$	112
Research and development	$	119	$	80	$	336	$	240
Selling, general and administrative	$	113	$	101	$	379	$	303


Apple Inc.UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS(In millions, except share amounts)

	June 25, 2011		September 25, 2010

ASSETS:

Current assets:
Cash and cash equivalents	$	12,091	$	11,261
Short-term marketable securities		16,304		14,359
Accounts receivable, less allowances of $55 in each period		6,102		5,510
Inventories		889		1,051
Deferred tax assets		1,892		1,636
Vendor non-trade receivables		5,369		4,414
Other current assets		4,251		3,447
Total current assets		46,898		41,678

Long-term marketable securities		47,761		25,391
Property, plant and equipment, net		6,749		4,768
Goodwill		741		741
Acquired intangible assets, net		1,169		342
Other assets		3,440		2,263
Total assets	$	106,758	$	75,183


LIABILITIES AND SHAREHOLDERS’ EQUITY:

Current liabilities:
Accounts payable	$	15,270	$	12,015
Accrued expenses		7,597		5,723
Deferred revenue		3,992		2,984
Total current liabilities		26,859		20,722

Deferred revenue – non-current		1,407		1,139
Other non-current liabilities		9,149		5,531
Total liabilities		37,415		27,392

Commitments and contingencies

Shareholders’ equity:
Common stock, no par value; 1,800,000,000 shares authorized; 926,903,779 and 915,970,050 shares issued and outstanding, respectively		12,715		10,668
Retained earnings		56,239		37,169
Accumulated other comprehensive income/(loss)		389		(46	)
Total shareholders’ equity		69,343		47,791

Total liabilities and shareholders’ equity	$	106,758	$	75,183


Apple Inc.UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(In millions)

	Nine Months Ended
	June 25, 2011			June 26, 2010

Cash and cash equivalents, beginning of the period	$	11,261		$	5,263

Operating activities:
Net income		19,299			9,705
Adjustments to reconcile net income to cash generated by operating activities:
Depreciation, amortization and accretion		1,271			698
Stock-based compensation expense		870			655
Deferred income tax expense		2,232			1,298
Changes in operating assets and liabilities:
Accounts receivable, net		(592	)		(79	)
Inventories		162			(487	)
Vendor non-trade receivables		(955	)		(1,256	)
Other current and non-current assets		(1,551	)		(1,001	)
Accounts payable		2,480			2,812
Deferred revenue		1,276			806
Other current and non-current liabilities		2,608			(239	)

Cash generated by operating activities		27,100			12,912

Investing activities:
Purchases of marketable securities		(75,133	)		(41,318	)
Proceeds from maturities of marketable securities		16,396			19,758
Proceeds from sales of marketable securities		34,301			14,048
Payments made in connection with business acquisitions, net of cash acquired		0			(615	)
Payments for acquisition of property, plant and equipment		(2,615	)		(1,245	)
Payments for acquisition of intangible assets		(266	)		(63	)
Other		34			(36	)

Cash used in investing activities		(27,283	)		(9,471	)

Financing activities:
Proceeds from issuance of common stock		577			733
Excess tax benefits from equity awards		915			652
Taxes paid related to net share settlement of equity awards		(479	)		(384	)

Cash generated by financing activities		1,013			1,001

Increase in cash and cash equivalents		830			4,442

Cash and cash equivalents, end of the period	$	12,091		$	9,705

Supplemental cash flow disclosure:
Cash paid for income taxes, net	$	2,563		$	2,657


Apple Inc.
Q3 2011 Unaudited Summary Data

		Q2 2011		Q3 2010		Q3 2011
								Sequential Change		Year/Year Change
Operating Segments		CPUUnits K	Revenue$M	CPUUnits K	Revenue$M	CPUUnits K	Revenue$M	CPU Units	Revenue	CPU Units	Revenue
	Americas	1,217	$9,323	1,358	$6,227	1,487	$10,126	22%	9%	9%	63%
	Europe	995	6,027	914	4,160	922	7,098	– 7%	18%	1%	71%
	Japan	155	1,383	129	910	150	1,510	– 3%	9%	16%	66%
	Asia Pacific	596	4,743	394	1,825	620	6,332	4%	34%	57%	247%
	Retail	797	3,191	677	2,578	768	3,505	– 4%	10%	13%	36%

Total Operating Segments		3,760	$24,667	3,472	$15,700	3,947	$28,571	5%	16%	14%	82%





								Sequential Change		Year/Year Change
Product Summary		Units K	Revenue$M	Units K	Revenue$M	Units K	Revenue$M	Units	Revenue	Units	Revenue
	Desktops (1)	1,009	$1,441	1,004	$1,301	1,155	$1,580	14%	10%	15%	21%

	Portables (2)	2,751	3,535	2,468	3,098	2,792	3,525	1%	0%	13%	14%


Subtotal CPUs		3,760	4,976	3,472	4,399	3,947	5,105	5%	3%	14%	16%
	iPod	9,017	1,600	9,406	1,545	7,535	1,325	– 16%	– 17%	– 20%	– 14%
	Other Music Related Products and Services (3)		1,634		1,214		1,571		– 4%		29%
	iPhone and Related Products and Services (4)	18,647	12,298	8,398	5,334	20,338	13,311	9%	8%	142%	150%
	iPad and Related Products and Services (5)	4,694	2,836	3,270	2,166	9,246	6,046	97%	113%	183%	179%
	Peripherals and Other Hardware (6)		580		396		517		– 11%		31%
	Software, Service and Other Sales (7)		743		646		696		– 6%		8%
Total Apple			$24,667		$15,700		$28,571		16%		82%



(1)	Includes iMac, Mac mini, Mac Pro and Xserve product lines.
(2)	Includes MacBook, MacBook Air and MacBook Pro product lines.
(3)	Includes sales from the iTunes Store, App Store, and iBookstore in addition to sales of iPod services and Apple-branded and third-party iPod accessories.
(4)	Includes revenue recognized from iPhone sales, carrier agreements, services, and Apple-branded and third-party iPhone accessories.
(5)	Includes revenue recognized from iPad sales, services, and Apple-branded and third-party iPad accessories.
(6)	Includes sales of displays, wireless connectivity and networking solutions, and other hardware accessories.
(7)	Includes sales from the Mac App Store in addition to sales of other Apple-branded and third-party Mac software and Mac and Internet services.

K = Units in thousands $M = Amounts in millions

Contacts

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