AAPL
$217.73
Apple
($3.23)
(1.46%)
Earnings Details
3rd Quarter June 2019
Tuesday, July 30, 2019 4:30:00 PM
Tweet Share Watch
Summary

Apple Reports In-line

Apple (AAPL) reported 3rd Quarter June 2019 earnings of $2.18 per share on revenue of $53.8 billion. The consensus earnings estimate was $2.10 per share on revenue of $53.3 billion. The Earnings Whisper number was $2.18 per share. Revenue grew 1.0% on a year-over-year basis.

The company said it expects fourth quarter revenue of $61.00 billion to $64.00 billion and gross margins of 37.5% to 38.5%, which calculates to earnings of $2.59 to $2.93 per share. The current consensus earnings estimate is $2.68 per share on revenue of $60.77 billion for the quarter ending September 30, 2019.

Apple Inc designs, manufactures, & markets mobile communication & media devices, personal computers, & portable digital music players, & sells a variety of related software, services, accessories, networking solutions, & third-party digital content.

Results
Reported Earnings
$2.18
Earnings Whisper
$2.18
Consensus Estimate
$2.10
Reported Revenue
$53.81 Bil
Revenue Estimate
$53.31 Bil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Apple Reports Third Quarter Results

Company Revenue Sets June Quarter Record

Services Revenue Reaches New All-Time High

CUPERTINO, Calif.--(BUSINESS WIRE)--Apple® today announced financial results for its fiscal 2019 third quarter ended June 29, 2019. The Company posted quarterly revenue of $53.8 billion, an increase of 1 percent from the year-ago quarter, and quarterly earnings per diluted share of $2.18, down 7 percent. International sales accounted for 59 percent of the quarter’s revenue.

“This was our biggest June quarter ever — driven by all-time record revenue from Services, accelerating growth from Wearables, strong performance from iPad and Mac and significant improvement in iPhone trends,” said Tim Cook, Apple’s CEO. “These results are promising across all our geographic segments, and we’re confident about what’s ahead. The balance of calendar 2019 will be an exciting period, with major launches on all of our platforms, new services and several new products.”

“Our year-over-year business performance improved compared to the March quarter and drove strong operating cash flow of $11.6 billion,” said Luca Maestri, Apple’s CFO. “We returned over $21 billion to shareholders during the quarter, including $17 billion through open market repurchases of almost 88 million Apple shares, and $3.6 billion in dividends and equivalents.”

Apple is providing the following guidance for its fiscal 2019 fourth quarter:

  • revenue between $61 billion and $64 billion
  • gross margin between 37.5 percent and 38.5 percent
  • operating expenses between $8.7 billion and $8.8 billion
  • other income/(expense) of $200 million
  • tax rate of approximately 16.5 percent

Apple’s board of directors has declared a cash dividend of $0.77 per share of the Company’s common stock. The dividend is payable on August 15, 2019 to shareholders of record as of the close of business on August 12, 2019.

Apple will provide live streaming of its Q3 2019 financial results conference call beginning at 2:00 p.m. PDT on July 30, 2019 at www.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 investors 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 estimated revenue, gross margin, operating expenses, other income/(expense), tax rate, and plans for return of capital. These statements involve risks and uncertainties, and actual results may differ. Risks and uncertainties include without limitation: 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 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 inventory and other asset risks 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, 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; the dependency of the Company on third-party intellectual property and digital content, 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, such as a potential finding that the Company has infringed on the intellectual property rights of others; the impact of changes to laws and regulations that affect the Company’s activities, including the Company’s ability to offer products or services to customers in different regions; the ability of the Company to manage risks associated with its international activities, including complying with laws and regulations affecting the Company’s international operations; 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 key executives and employees; political events, international trade disputes, war, terrorism, natural disasters, public health issues, 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 and exposure to additional tax liabilities. More information on these risks and other potential factors that could affect the Company’s 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 four software platforms — iOS, 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.

© 2019 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 per share amounts)

 

Three Months Ended

 

Nine Months Ended

 

June 29,
2019

 

June 30,
2018

 

June 29,
2019

 

June 30,
2018

Net sales:

 

 

 

 

 

 

 

Products

$

42,354

 

 

$

43,095

 

 

$

162,354

 

 

$

173,546

 

Services

11,455

 

 

10,170

 

 

33,780

 

 

29,149

 

Total net sales (1)

53,809

 

 

53,265

 

 

196,134

 

 

202,695

 

Cost of sales:

 

 

 

 

 

 

 

Products

29,473

 

 

28,956

 

 

109,758

 

 

113,467

 

Services

4,109

 

 

3,888

 

 

12,297

 

 

11,473

 

Total cost of sales

33,582

 

 

32,844

 

 

122,055

 

 

124,940

 

Gross margin

20,227

 

 

20,421

 

 

74,079

 

 

77,755

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

Research and development

4,257

 

 

3,701

 

 

12,107

 

 

10,486

 

Selling, general and administrative

4,426

 

 

4,108

 

 

13,667

 

 

12,489

 

Total operating expenses

8,683

 

 

7,809

 

 

25,774

 

 

22,975

 

 

 

 

 

 

 

 

 

Operating income

11,544

 

 

12,612

 

 

48,305

 

 

54,780

 

Other income/(expense), net

367

 

 

672

 

 

1,305

 

 

1,702

 

Income before provision for income taxes

11,911

 

 

13,284

 

 

49,610

 

 

56,482

 

Provision for income taxes

1,867

 

 

1,765

 

 

8,040

 

 

11,076

 

Net income

$

10,044

 

 

$

11,519

 

 

$

41,570

 

 

$

45,406

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

Basic

$

2.20

 

 

$

2.36

 

 

$

8.92

 

 

$

9.07

 

Diluted

$

2.18

 

 

$

2.34

 

 

$

8.86

 

 

$

8.99

 

Shares used in computing earnings per share:

 

 

 

 

 

 

 

Basic

4,570,633

 

 

4,882,167

 

 

4,660,175

 

 

5,006,640

 

Diluted

4,601,380

 

 

4,926,609

 

 

4,691,759

 

 

5,050,963

 

 

 

 

 

 

 

 

 

(1) Net sales by reportable segment:

 

 

 

 

 

 

 

Americas

$

25,056

 

 

$

24,542

 

 

$

87,592

 

 

$

84,576

 

Europe

11,925

 

 

12,138

 

 

45,342

 

 

47,038

 

Greater China

9,157

 

 

9,551

 

 

32,544

 

 

40,531

 

Japan

4,082

 

 

3,867

 

 

16,524

 

 

16,572

 

Rest of Asia Pacific

3,589

 

 

3,167

 

 

14,132

 

 

13,978

 

Total net sales

$

53,809

 

 

$

53,265

 

 

$

196,134

 

 

$

202,695

 

 

 

 

 

 

 

 

 

(1) Net sales by category:

 

 

 

 

 

 

 

iPhone

$

25,986

 

 

$

29,470

 

 

$

109,019

 

 

$

128,133

 

Mac

5,820

 

 

5,258

 

 

18,749

 

 

17,858

 

iPad

5,023

 

 

4,634

 

 

16,624

 

 

14,397

 

Wearables, Home and Accessories

5,525

 

 

3,733

 

 

17,962

 

 

13,158

 

Services

11,455

 

 

10,170

 

 

33,780

 

 

29,149

 

Total net sales

$

53,809

$

53,265

$

196,134

$

202,695

Apple Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(In millions, except number of shares which are reflected in thousands and par value)

 

June 29,
2019

 

September 29,
2018

ASSETS:

Current assets:

 

 

 

Cash and cash equivalents

$

50,530

 

 

$

25,913

 

Marketable securities

44,084

 

 

40,388

 

Accounts receivable, net

14,148

 

 

23,186

 

Inventories

3,355

 

 

3,956

 

Vendor non-trade receivables

12,326

 

 

25,809

 

Other current assets

10,530

 

 

12,087

 

Total current assets

134,973

 

 

131,339

 

 

 

 

 

Non-current assets:

 

 

 

Marketable securities

115,996

 

 

170,799

 

Property, plant and equipment, net

37,636

 

 

41,304

 

Other non-current assets

33,634

 

 

22,283

 

Total non-current assets

187,266

 

 

234,386

 

Total assets

$

322,239

 

 

$

365,725

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY:

Current liabilities:

 

 

 

Accounts payable

$

29,115

 

 

$

55,888

 

Other current liabilities

31,673

 

 

33,327

 

Deferred revenue

5,434

 

 

5,966

 

Commercial paper

9,953

 

 

11,964

 

Term debt

13,529

 

 

8,784

 

Total current liabilities

89,704

 

 

115,929

 

 

 

 

 

Non-current liabilities:

 

 

 

Term debt

84,936

 

 

93,735

 

Other non-current liabilities

51,143

 

 

48,914

 

Total non-current liabilities

136,079

 

 

142,649

 

Total liabilities

225,783

 

 

258,578

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

Shareholders’ equity:

 

 

 

Common stock and additional paid-in capital, $0.00001 par value: 12,600,000 shares authorized; 4,531,395 and 4,754,986 shares issued and outstanding, respectively

43,371

 

 

40,201

 

Retained earnings

53,724

 

 

70,400

 

Accumulated other comprehensive income/(loss)

(639

)

 

(3,454

)

Total shareholders’ equity

96,456

 

 

107,147

 

Total liabilities and shareholders’ equity

$

322,239

 

 

$

365,725

 

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

 

Nine Months Ended

 

June 29,
2019

 

June 30,
2018

Cash, cash equivalents and restricted cash, beginning balances

$

25,913

 

 

$

20,289

 

Operating activities:

 

 

 

Net income

41,570

 

 

45,406

 

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

 

 

 

Depreciation and amortization

9,368

 

 

8,149

 

Share-based compensation expense

4,569

 

 

3,995

 

Deferred income tax benefit

(38

)

 

(33,109

)

Other

(340

)

 

(410

)

Changes in operating assets and liabilities:

 

 

 

Accounts receivable, net

9,013

 

 

3,756

 

Inventories

496

 

 

(1,114

)

Vendor non-trade receivables

13,483

 

 

5,536

 

Other current and non-current assets

693

 

 

(65

)

Accounts payable

(19,804

)

 

(10,410

)

Deferred revenue

(776

)

 

(73

)

Other current and non-current liabilities

(8,753

)

 

36,250

 

Cash generated by operating activities

49,481

 

 

57,911

 

Investing activities:

 

 

 

Purchases of marketable securities

(21,902

)

 

(56,133

)

Proceeds from maturities of marketable securities

26,783

 

 

46,290

 

Proceeds from sales of marketable securities

49,516

 

 

41,614

 

Payments for acquisition of property, plant and equipment

(7,718

)

 

(10,272

)

Payments made in connection with business acquisitions, net

(611

)

 

(431

)

Purchases of non-marketable securities

(632

)

 

(1,788

)

Proceeds from non-marketable securities

1,526

 

 

310

 

Other

(268

)

 

(523

)

Cash generated by investing activities

46,694

 

 

19,067

 

Financing activities:

 

 

 

Proceeds from issuance of common stock

391

 

 

328

 

Payments for taxes related to net share settlement of equity awards

(2,626

)

 

(2,267

)

Payments for dividends and dividend equivalents

(10,640

)

 

(10,182

)

Repurchases of common stock

(49,453

)

 

(53,634

)

Proceeds from issuance of term debt, net

 

 

6,969

 

Repayments of term debt

(5,500

)

 

(6,500

)

Repayments of commercial paper, net

(2,026

)

 

(10

)

Other

(83

)

 

 

Cash used in financing activities

(69,937

)

 

(65,296

)

Increase in cash, cash equivalents and restricted cash

26,238

 

 

11,682

 

Cash, cash equivalents and restricted cash, ending balances

$

52,151

 

 

$

31,971

 

Supplemental cash flow disclosure:

 

 

 

Cash paid for income taxes, net

$

11,795

 

 

$

8,819

 

Cash paid for interest

$

2,563

 

 

$

2,120

 

 

Apple
Press Contact:
Kristin Huguet, (408) 974-2414
khuguet@apple.com

Investor Relations Contacts:
Nancy Paxton, (408) 974-5420
paxton1@apple.com

Tejas Gala, (669) 227-2402
tgala@apple.com

Source: Apple Inc.