Business Wire | Jan 27, 2022 04:30PM EST

Apple Reports First Quarter Results

Jan. 27, 2022

CUPERTINO, Calif.--(BUSINESS WIRE)--Jan. 27, 2022--Apple(r) today announced financial results for its fiscal 2022 first quarter ended December 25, 2021. The Company posted an all-time revenue record of $123.9 billion, up 11 percent year over year, and quarterly earnings per diluted share of $2.10.

"This quarter's record results were made possible by our most innovative lineup of products and services ever," said Tim Cook, Apple's CEO. "We are gratified to see the response from customers around the world at a time when staying connected has never been more important. We are doing all we can to help build a better world - making progress toward our goal of becoming carbon neutral across our supply chain and products by 2030, and pushing forward with our work in education and racial equity and justice."

"The very strong customer response to our recent launch of new products and services drove double-digit growth in revenue and earnings, and helped set an all-time high for our installed base of active devices," said Luca Maestri, Apple's CFO. "These record operating results allowed us to return nearly $27 billion to our shareholders during the quarter, as we maintain our target of reaching a net cash neutral position over time."

Apple's board of directors has declared a cash dividend of $0.22 per share of the Company's common stock. The dividend is payable on February 10, 2022 to shareholders of record as of the close of business on February 7, 2022.

Apple will provide live streaming of its Q1 2022 financial results conference call beginning at 2:00 p.m. PT on January 27, 2022 at apple.com/investor/earnings-call. This webcast will also be available for replay for approximately two weeks thereafter.

Apple periodically provides information for investors on its corporate website, apple.com, and its investor relations website, investor.apple.com. This includes press releases and other information about financial performance, reports filed or furnished with the SEC, information on corporate governance, and details related to its annual meeting of shareholders.

This press release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include without limitation those about the Company's plans for return of capital, the payment of its quarterly dividend, and its investment plans and environmental initiatives. These statements involve risks and uncertainties, and actual results may differ materially from any future results expressed or implied by the forward-looking statements. Risks and uncertainties include without limitation: the effect of the COVID-19 pandemic on the Company's business, results of operations, financial condition, and stock price; the effect of global and regional economic conditions on the Company's business, including effects on purchasing decisions by consumers and businesses; the ability of the Company to compete in markets that are highly competitive and subject to rapid technological change; the ability of the Company to manage frequent introductions and transitions of products and services, including delivering to the marketplace, and stimulating customer demand for, new products, services, and technological innovations on a timely basis; the effect that shifts in the mix of products and services and in the geographic, currency, or channel mix, component cost increases, increases in the cost of developing, acquiring, and delivering content for the Company's services, price competition, or the introduction of new products or services, including new products or services with higher cost structures, could have on the Company's gross margin; the dependency of the Company on the performance of distributors of the Company's products, including cellular network carriers and other resellers; the risk of write-downs on the value of inventory and other assets and purchase commitment cancellation risk; the continued availability on acceptable terms, or at all, of certain components, services, and new technologies essential to the Company's business, including components and technologies that may only be available from single or limited sources; the dependency of the Company on manufacturing and logistics services provided by third parties, many of which are located outside of the US and which may affect the quality, quantity, or cost of products manufactured or services rendered to the Company; the effect of product and services design and manufacturing defects on the Company's financial performance and reputation; failure to obtain or create digital content that appeals to the Company's customers, or to make such content available on commercially reasonable terms; the dependency of the Company on third-party intellectual property, which may not be available to the Company on commercially reasonable terms or at all; the dependency of the Company on support from third-party software developers to develop and maintain software applications and services for the Company's products; the impact of unfavorable legal proceedings or government investigations; the impact of complex and changing laws and regulations worldwide, which expose the Company to potential liabilities, increased costs, and other adverse effects on the Company's business; the intense media, political, and regulatory scrutiny, which exposes the Company to increasing regulation, government investigations, legal actions, and penalties; the ability of the Company to manage risks associated with the Company's retail stores; the ability of the Company to manage risks associated with the Company's investments in new business strategies and acquisitions; the impact on the Company's business and reputation from information technology system failures, network disruptions, or losses or unauthorized access to, or release of, confidential information; the ability of the Company to comply with laws and regulations regarding data protection; the continued service and availability of highly skilled employees, including key personnel; political events, trade and other international disputes, war, terrorism, natural disasters, public health issues, industrial accidents, and other business interruptions that could disrupt supply or delivery of, or demand for, the Company's products; financial risks, including risks relating to currency fluctuations, credit risks, and fluctuations in the market value of the Company's investment portfolio; and changes in tax rates, the adoption of new US or international tax legislation, and exposure to additional tax liabilities. More information on these risks and other potential factors that could affect the Company's business and financial results is included in the Company's filings with the SEC, including in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of the Company's most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings. 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, Mac, Apple Watch, and Apple TV. Apple's five software platforms - iOS, iPadOS, macOS, watchOS, and tvOS - 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 more than 100,000 employees are dedicated to making the best products on earth, and to leaving the world better than we found it.

NOTE TO EDITORS: For additional information visit Apple Newsroom (www.apple.com/newsroom), or call Apple's Media Helpline at (408) 974-2042.

(c) 2022 Apple Inc. All rights reserved. Apple and the Apple logo are trademarks of Apple. Other company and product names may be trademarks of their respective owners.

Apple Inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

(In millions, except number of shares which are reflected in thousands and pershare amounts)

Three Months Ended

December 25, December 26, 2021 2020

Net sales:

Products $ 104,429 $ 95,678

Services 19,516 15,761

Total net sales ^(1) 123,945 111,439

Cost of sales:

Products 64,309 62,130

Services 5,393 4,981

Total cost of sales 69,702 67,111

Gross margin 54,243 44,328



Operating expenses:

Research and development 6,306 5,163

Selling, general and administrative 6,449 5,631

Total operating expenses 12,755 10,794



Operating income 41,488 33,534

Other income/(expense), net (247) 45

Income before provision for income taxes 41,241 33,579

Provision for income taxes 6,611 4,824

Net income $ 34,630 $ 28,755



Earnings per share:

Basic $ 2.11 $ 1.70

Diluted $ 2.10 $ 1.68

Shares used in computing earnings per share:

Basic 16,391,724 16,935,119

Diluted 16,519,291 17,113,688



^(1) Net sales by reportable segment:

Americas $ 51,496 $ 46,310

Europe 29,749 27,306

Greater China 25,783 21,313

Japan 7,107 8,285

Rest of Asia Pacific 9,810 8,225

Total net sales $ 123,945 $ 111,439



^(1) Net sales by category:

iPhone $ 71,628 $ 65,597

Mac 10,852 8,675

iPad 7,248 8,435

Wearables, Home and Accessories 14,701 12,971

Services 19,516 15,761

Total net sales $ 123,945 $ 111,439

Apple Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

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

December 25,2021

September 25,2021

ASSETS:

Current assets:

Cash and cash equivalents

$

37,119

$

34,940

Marketable securities

26,794

27,699

Accounts receivable, net

30,213

26,278

Inventories

5,876

6,580

Vendor non-trade receivables

35,040

25,228

Other current assets

18,112

14,111

Total current assets

153,154

134,836

Non-current assets:

Marketable securities

138,683

127,877

Property, plant and equipment, net

39,245

39,440

Other non-current assets

50,109

48,849

Total non-current assets

228,037

216,166

Total assets

$

381,191

$

351,002

LIABILITIES AND SHAREHOLDERS' EQUITY:

Current liabilities:

Accounts payable

$

74,362

$

54,763

Other current liabilities

49,167

47,493

Deferred revenue

7,876

7,612

Commercial paper

5,000

6,000

Term debt

11,169

9,613

Total current liabilities

147,574

125,481

Non-current liabilities:

Term debt

106,629

109,106

Other non-current liabilities

55,056

53,325

Total non-current liabilities

161,685

162,431

Total liabilities

309,259

287,912

Commitments and contingencies

Shareholders' equity:

Common stock and additional paid-in capital, $0.00001 par value: 50,400,000 shares authorized; 16,340,851 and 16,426,786 shares issued and outstanding, respectively

58,424

57,365

Retained earnings

14,435

5,562

Accumulated other comprehensive income/(loss)

(927)

163

Total shareholders' equity

71,932

63,090

Total liabilities and shareholders' equity

$

381,191

$

351,002

Apple Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

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

December September 25, 25, 2021 2021

ASSETS:

Current assets:

Cash and cash equivalents $ 37,119 $ 34,940

Marketable securities 26,794 27,699

Accounts receivable, net 30,213 26,278

Inventories 5,876 6,580

Vendor non-trade receivables 35,040 25,228

Other current assets 18,112 14,111

Total current assets 153,154 134,836



Non-current assets:

Marketable securities 138,683 127,877

Property, plant and equipment, net 39,245 39,440

Other non-current assets 50,109 48,849

Total non-current assets 228,037 216,166

Total assets $ 381,191 $ 351,002



LIABILITIES AND SHAREHOLDERS' EQUITY:

Current liabilities:

Accounts payable $ 74,362 $ 54,763

Other current liabilities 49,167 47,493

Deferred revenue 7,876 7,612

Commercial paper 5,000 6,000

Term debt 11,169 9,613

Total current liabilities 147,574 125,481



Non-current liabilities:

Term debt 106,629 109,106

Other non-current liabilities 55,056 53,325

Total non-current liabilities 161,685 162,431

Total liabilities 309,259 287,912



Commitments and contingencies



Shareholders' equity:

Common stock and additional paid-in capital, $0.00001par value: 50,400,000 shares authorized; 16,340,851 58,424 57,365 and 16,426,786 shares issued and outstanding,respectively

Retained earnings 14,435 5,562

Accumulated other comprehensive income/(loss) (927) 163

Total shareholders' equity 71,932 63,090

Total liabilities and shareholders' equity $ 381,191 $ 351,002

Apple Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(In millions)

Three Months Ended

December 25,2021

December 26,2020

Cash, cash equivalents and restricted cash, beginning balances

$

35,929

$

39,789

Operating activities:

Net income

34,630

28,755

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

Depreciation and amortization

2,697

2,666

Share-based compensation expense

2,265

2,020

Deferred income tax expense/(benefit)

682

(58)

Other

167

25

Changes in operating assets and liabilities:

Accounts receivable, net

(3,934)

(10,945)

Inventories

681

(950)

Vendor non-trade receivables

(9,812)

(10,194)

Other current and non-current assets

(4,921)

(3,526)

Accounts payable

19,813

21,670

Deferred revenue

462

1,341

Other current and non-current liabilities

4,236

7,959

Cash generated by operating activities

46,966

38,763

Investing activities:

Purchases of marketable securities

(34,913)

(39,800)

Proceeds from maturities of marketable securities

11,309

25,177

Proceeds from sales of marketable securities

10,675

9,344

Payments for acquisition of property, plant and equipment

(2,803)

(3,500)

Other

(374)

195

Cash used in investing activities

(16,106)

(8,584)

Financing activities:

Payments for taxes related to net share settlement of equity awards

(2,888)

(2,861)

Payments for dividends and dividend equivalents

(3,732)

(3,613)

Repurchases of common stock

(20,478)

(24,775)

Repayments of term debt

-

(1,000)

Proceeds from/(Repayments of) commercial paper, net

(1,000)

22

Other

(61)

(22)

Cash used in financing activities

(28,159)

(32,249)

Increase/(Decrease) in cash, cash equivalents and restricted cash

2,701

(2,070)

Cash, cash equivalents and restricted cash, ending balances

$

38,630

$

37,719

Supplemental cash flow disclosure:

Cash paid for income taxes, net

$

5,235

$

1,787

Cash paid for interest

$

531

$

619

View source version on businesswire.com: https://www.businesswire.com/news/home/20220127005993/en/

CONTACT: Press Contact: Josh Rosenstock Apple jrosenstock@apple.com (408) 862-1142

CONTACT: Investor Relations Contact: Tejas Gala Apple tgala@apple.com (669) 227-2402