Apple Reports Second Quarter Results

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Revenue up 9 percent to new March quarter record

Services revenue reaches new all-time high

CUPERTINO, Calif.Apple® today announced financial results for its fiscal 2022 second quarter ended March 26, 2022. The Company posted a March quarter revenue record of $97.3 billion, up 9 percent year over year, and quarterly earnings per diluted share of $1.52.

“This quarter’s record results are a testament to Apple’s relentless focus on innovation and our ability to create the best products and services in the world,” said Tim Cook, Apple’s CEO. “We are delighted to see the strong customer response to our new products, as well as the progress we’re making to become carbon neutral across our supply chain and our products by 2030. We are committed, as ever, to being a force for good in the world — both in what we create and what we leave behind.”

“We are very pleased with our record business results for the March quarter, as we set an all-time revenue record for Services and March quarter revenue records for iPhone, Mac, and Wearables, Home and Accessories. Continued strong customer demand for our products helped us achieve an all-time high for our installed base of active devices,” said Luca Maestri, Apple’s CFO. “Our strong operating performance generated over $28 billion in operating cash flow, and allowed us to return nearly $27 billion to our shareholders during the quarter.”

Apple’s board of directors has declared a cash dividend of $0.23 per share of the Company’s common stock, an increase of 5 percent. The dividend is payable on May 12, 2022 to shareholders of record as of the close of business on May 9, 2022. The board of directors has also authorized an increase of $90 billion to the existing share repurchase program.

Apple will provide live streaming of its Q2 2022 financial results conference call beginning at 2:00 p.m. PT on April 28, 2022 at apple.com/investor/earnings-call. This webcast will 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.

© 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 per share amounts)

 

 

Three Months Ended

 

Six Months Ended

 

March 26,
2022

 

March 27,
2021

 

March 26,
2022

 

March 27,
2021

Net sales:

 

 

 

 

 

 

 

Products

$

77,457

 

$

72,683

 

$

181,886

 

 

$

168,361

Services

 

19,821

 

 

16,901

 

 

39,337

 

 

 

32,662

Total net sales (1)

 

97,278

 

 

89,584

 

 

221,223

 

 

 

201,023

Cost of sales:

 

 

 

 

 

 

 

Products

 

49,290

 

 

46,447

 

 

113,599

 

 

 

108,577

Services

 

5,429

 

 

5,058

 

 

10,822

 

 

 

10,039

Total cost of sales

 

54,719

 

 

51,505

 

 

124,421

 

 

 

118,616

Gross margin

 

42,559

 

 

38,079

 

 

96,802

 

 

 

82,407

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

Research and development

 

6,387

 

 

5,262

 

 

12,693

 

 

 

10,425

Selling, general and administrative

 

6,193

 

 

5,314

 

 

12,642

 

 

 

10,945

Total operating expenses

 

12,580

 

 

10,576

 

 

25,335

 

 

 

21,370

 

 

 

 

 

 

 

 

Operating income

 

29,979

 

 

27,503

 

 

71,467

 

 

 

61,037

Other income/(expense), net

 

160

 

 

508

 

 

(87

)

 

 

553

Income before provision for income taxes

 

30,139

 

 

28,011

 

 

71,380

 

 

 

61,590

Provision for income taxes

 

5,129

 

 

4,381

 

 

11,740

 

 

 

9,205

Net income

$

25,010

 

$

23,630

 

$

59,640

 

 

$

52,385

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

Basic

$

1.54

 

$

1.41

 

$

3.65

 

 

$

3.11

Diluted

$

1.52

 

$

1.40

 

$

3.62

 

 

$

3.08

Shares used in computing earnings per share:

 

 

 

 

 

 

 

Basic

 

16,278,802

 

 

16,753,476

 

 

16,335,263

 

 

 

16,844,298

Diluted

 

16,403,316

 

 

16,929,157

 

 

16,461,304

 

 

 

17,021,423

 

 

 

 

 

 

 

 

(1) Net sales by reportable segment:

 

 

 

 

 

 

 

Americas

$

40,882

 

$

34,306

 

$

92,378

 

 

$

80,616

Europe

 

23,287

 

 

22,264

 

 

53,036

 

 

 

49,570

Greater China

 

18,343

 

 

17,728

 

 

44,126

 

 

 

39,041

Japan

 

7,724

 

 

7,742

 

 

14,831

 

 

 

16,027

Rest of Asia Pacific

 

7,042

 

 

7,544

 

 

16,852

 

 

 

15,769

Total net sales

$

97,278

 

$

89,584

 

$

221,223

 

 

$

201,023

 

 

 

 

 

 

 

 

(1) Net sales by category:

 

 

 

 

 

 

 

iPhone

$

50,570

 

$

47,938

 

$

122,198

 

 

$

113,535

Mac

 

10,435

 

 

9,102

 

 

21,287

 

 

 

17,777

iPad

 

7,646

 

 

7,807

 

 

14,894

 

 

 

16,242

Wearables, Home and Accessories

 

8,806

 

 

7,836

 

 

23,507

 

 

 

20,807

Services

 

19,821

 

 

16,901

 

 

39,337

 

 

 

32,662

Total net sales

$

97,278

 

$

89,584

 

$

221,223

 

 

$

201,023

Apple Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

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

 

 

March 26,
2022

 

September 25,
2021

ASSETS:

Current assets:

 

 

 

Cash and cash equivalents

$

28,098

 

 

$

34,940

Marketable securities

 

23,413

 

 

 

27,699

Accounts receivable, net

 

20,815

 

 

 

26,278

Inventories

 

5,460

 

 

 

6,580

Vendor non-trade receivables

 

24,585

 

 

 

25,228

Other current assets

 

15,809

 

 

 

14,111

Total current assets

 

118,180

 

 

 

134,836

 

 

 

 

Non-current assets:

 

 

 

Marketable securities

 

141,219

 

 

 

127,877

Property, plant and equipment, net

 

39,304

 

 

 

39,440

Other non-current assets

 

51,959

 

 

 

48,849

Total non-current assets

 

232,482

 

 

 

216,166

Total assets

$

350,662

 

 

$

351,002

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY:

Current liabilities:

 

 

 

Accounts payable

$

52,682

 

 

$

54,763

Other current liabilities

 

50,248

 

 

 

47,493

Deferred revenue

 

7,920

 

 

 

7,612

Commercial paper

 

6,999

 

 

 

6,000

Term debt

 

9,659

 

 

 

9,613

Total current liabilities

 

127,508

 

 

 

125,481

 

 

 

 

Non-current liabilities:

 

 

 

Term debt

 

103,323

 

 

 

109,106

Other non-current liabilities

 

52,432

 

 

 

53,325

Total non-current liabilities

 

155,755

 

 

 

162,431

Total liabilities

 

283,263

 

 

 

287,912

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

Shareholders’ equity:

 

 

 

Common stock and additional paid-in capital, $0.00001 par value: 50,400,000 shares authorized; 16,207,568 and 16,426,786 shares issued and outstanding, respectively

 

61,181

 

 

 

57,365

Retained earnings

 

12,712

 

 

 

5,562

Accumulated other comprehensive income/(loss)

 

(6,494

)

 

 

163

Total shareholders’ equity

 

67,399

 

 

 

63,090

Total liabilities and shareholders’ equity

$

350,662

 

 

$

351,002

Apple Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(In millions)

 

 

Six Months Ended

 

March 26,
2022

 

March 27,
2021

Cash, cash equivalents and restricted cash, beginning balances

$

35,929

 

 

$

39,789

 

Operating activities:

 

 

 

Net income

 

59,640

 

 

 

52,385

 

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

 

 

 

Depreciation and amortization

 

5,434

 

 

 

5,463

 

Share-based compensation expense

 

4,517

 

 

 

4,001

 

Deferred income tax expense/(benefit)

 

1,088

 

 

 

(207

)

Other

 

(20

)

 

 

(474

)

Changes in operating assets and liabilities:

 

 

 

Accounts receivable, net

 

5,542

 

 

 

(2,347

)

Inventories

 

1,065

 

 

 

(1,226

)

Vendor non-trade receivables

 

643

 

 

 

6,792

 

Other current and non-current assets

 

(3,542

)

 

 

(4,333

)

Accounts payable

 

(1,750

)

 

 

(1,997

)

Deferred revenue

 

627

 

 

 

1,642

 

Other current and non-current liabilities

 

1,888

 

 

 

3,045

 

Cash generated by operating activities

 

75,132

 

 

 

62,744

 

Investing activities:

 

 

 

Purchases of marketable securities

 

(61,987

)

 

 

(74,424

)

Proceeds from maturities of marketable securities

 

18,000

 

 

 

39,605

 

Proceeds from sales of marketable securities

 

24,668

 

 

 

21,645

 

Payments for acquisition of property, plant and equipment

 

(5,317

)

 

 

(5,769

)

Payments made in connection with business acquisitions, net

 

(167

)

 

 

(9

)

Other

 

(568

)

 

 

 

Cash used in investing activities

 

(25,371

)

 

 

(18,952

)

Financing activities:

 

 

 

Payments for taxes related to net share settlement of equity awards

 

(3,218

)

 

 

(3,160

)

Payments for dividends and dividend equivalents

 

(7,327

)

 

 

(7,060

)

Repurchases of common stock

 

(43,109

)

 

 

(43,323

)

Proceeds from issuance of term debt, net

 

 

 

 

13,923

 

Repayments of term debt

 

(3,750

)

 

 

(4,500

)

Proceeds from commercial paper, net

 

999

 

 

 

22

 

Other

 

(105

)

 

 

523

 

Cash used in financing activities

 

(56,510

)

 

 

(43,575

)

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

 

(6,749

)

 

 

217

 

Cash, cash equivalents and restricted cash, ending balances

$

29,180

 

 

$

40,006

 

Supplemental cash flow disclosure:

 

 

 

Cash paid for income taxes, net

$

9,301

 

 

$

10,276

 

Cash paid for interest

$

1,406

 

 

$

1,327

 

 

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

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

Source: Apple Inc.