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Apple reports third quarter results

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Apple announces Q3 2023 financial results with revenue of $81.8 billion, down 1% YoY. Services revenue reaches all-time high. Installed base of active devices sets all-time record.
Positive
  • Services revenue reaches all-time high
Negative
  • Revenue down 1% YoY

Services revenue reaches new all-time high

Installed base of active devices sets all-time record

CUPERTINO, Calif.--(BUSINESS WIRE)-- Apple® today announced financial results for its fiscal 2023 third quarter ended July 1, 2023. The Company posted quarterly revenue of $81.8 billion, down 1 percent year over year, and quarterly earnings per diluted share of $1.26, up 5 percent year over year.

“We are happy to report that we had an all-time revenue record in Services during the June quarter, driven by over 1 billion paid subscriptions, and we saw continued strength in emerging markets thanks to robust sales of iPhone,” said Tim Cook, Apple’s CEO. “From education to the environment, we are continuing to advance our values, while championing innovation that enriches the lives of our customers and leaves the world better than we found it.”

“Our June quarter year-over-year business performance improved from the March quarter, and our installed base of active devices reached an all-time high in every geographic segment,” said Luca Maestri, Apple’s CFO. “During the quarter, we generated very strong operating cash flow of $26 billion, returned over $24 billion to our shareholders, and continued to invest in our long-term growth plans.”

Apple’s board of directors has declared a cash dividend of $0.24 per share of the Company’s common stock. The dividend is payable on August 17, 2023 to shareholders of record as of the close of business on August 14, 2023.

Apple will provide live streaming of its Q3 2023 financial results conference call beginning at 2:00 p.m. PT on August 3, 2023 at apple.com/investor/earnings-call. The 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 payment of the Company’s quarterly dividend. 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: effects of global and regional economic conditions, including as a result of government policies, war, terrorism, natural disasters, and public health issues; risks relating to the design, manufacture, introduction, and transition of products and services in highly competitive and rapidly changing markets, including from reliance on third parties for components, technology, manufacturing, applications, and content; risks relating to information technology system failures, network disruptions, and failure to protect, loss of, or unauthorized access to, or release of, data; and effects of unfavorable legal proceedings, government investigations, and complex and changing laws and regulations. More information on these risks and other potential factors that could affect the Company’s business, reputation, results of operations, financial condition, and stock price 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, which speak only as of the date they are made.

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 email Apple’s Media Helpline at media.help@apple.com.

© 2023 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

 

July 1,
2023

 

June 25,
2022

 

July 1,
2023

 

June 25,
2022

Net sales:

 

 

 

 

 

 

 

Products

$

60,584

 

 

$

63,355

 

 

$

230,901

 

 

$

245,241

 

Services

 

21,213

 

 

 

19,604

 

 

 

62,886

 

 

 

58,941

 

Total net sales (1)

 

81,797

 

 

 

82,959

 

 

 

293,787

 

 

 

304,182

 

Cost of sales:

 

 

 

 

 

 

 

Products

 

39,136

 

 

 

41,485

 

 

 

146,696

 

 

 

155,084

 

Services

 

6,248

 

 

 

5,589

 

 

 

18,370

 

 

 

16,411

 

Total cost of sales

 

45,384

 

 

 

47,074

 

 

 

165,066

 

 

 

171,495

 

Gross margin

 

36,413

 

 

 

35,885

 

 

 

128,721

 

 

 

132,687

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

Research and development

 

7,442

 

 

 

6,797

 

 

 

22,608

 

 

 

19,490

 

Selling, general and administrative

 

5,973

 

 

 

6,012

 

 

 

18,781

 

 

 

18,654

 

Total operating expenses

 

13,415

 

 

 

12,809

 

 

 

41,389

 

 

 

38,144

 

 

 

 

 

 

 

 

 

Operating income

 

22,998

 

 

 

23,076

 

 

 

87,332

 

 

 

94,543

 

Other income/(expense), net

 

(265

)

 

 

(10

)

 

 

(594

)

 

 

(97

)

Income before provision for income taxes

 

22,733

 

 

 

23,066

 

 

 

86,738

 

 

 

94,446

 

Provision for income taxes

 

2,852

 

 

 

3,624

 

 

 

12,699

 

 

 

15,364

 

Net income

$

19,881

 

 

$

19,442

 

 

$

74,039

 

 

$

79,082

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

Basic

$

1.27

 

 

$

1.20

 

 

$

4.69

 

 

$

4.86

 

Diluted

$

1.26

 

 

$

1.20

 

 

$

4.67

 

 

$

4.82

 

Shares used in computing earnings per share:

 

 

 

 

 

 

 

Basic

 

15,697,614

 

 

 

16,162,945

 

 

 

15,792,497

 

 

 

16,277,824

 

Diluted

 

15,775,021

 

 

 

16,262,203

 

 

 

15,859,263

 

 

 

16,394,937

 

 

 

 

 

 

 

 

 

(1) Net sales by reportable segment:

 

 

 

 

 

 

 

Americas

$

35,383

 

 

$

37,472

 

 

$

122,445

 

 

$

129,850

 

Europe

 

20,205

 

 

 

19,287

 

 

 

71,831

 

 

 

72,323

 

Greater China

 

15,758

 

 

 

14,604

 

 

 

57,475

 

 

 

58,730

 

Japan

 

4,821

 

 

 

5,446

 

 

 

18,752

 

 

 

20,277

 

Rest of Asia Pacific

 

5,630

 

 

 

6,150

 

 

 

23,284

 

 

 

23,002

 

Total net sales

$

81,797

 

 

$

82,959

 

 

$

293,787

 

 

$

304,182

 

 

 

 

 

 

 

 

 

(1) Net sales by category:

 

 

 

 

 

 

 

iPhone

$

39,669

 

 

$

40,665

 

 

$

156,778

 

 

$

162,863

 

Mac

 

6,840

 

 

 

7,382

 

 

 

21,743

 

 

 

28,669

 

iPad

 

5,791

 

 

 

7,224

 

 

 

21,857

 

 

 

22,118

 

Wearables, Home and Accessories

 

8,284

 

 

 

8,084

 

 

 

30,523

 

 

 

31,591

 

Services

 

21,213

 

 

 

19,604

 

 

 

62,886

 

 

 

58,941

 

Total net sales

$

81,797

 

 

$

82,959

 

 

$

293,787

 

 

$

304,182

 

Apple Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

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

 

 

July 1,
2023

 

September 24,
2022

ASSETS:

Current assets:

 

 

 

Cash and cash equivalents

$

28,408

 

 

$

23,646

 

Marketable securities

 

34,074

 

 

 

24,658

 

Accounts receivable, net

 

19,549

 

 

 

28,184

 

Inventories

 

7,351

 

 

 

4,946

 

Vendor non-trade receivables

 

19,637

 

 

 

32,748

 

Other current assets

 

13,640

 

 

 

21,223

 

Total current assets

 

122,659

 

 

 

135,405

 

 

 

 

 

Non-current assets:

 

 

 

Marketable securities

 

104,061

 

 

 

120,805

 

Property, plant and equipment, net

 

43,550

 

 

 

42,117

 

Other non-current assets

 

64,768

 

 

 

54,428

 

Total non-current assets

 

212,379

 

 

 

217,350

Total assets

$

335,038

 

 

$

352,755

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY:

Current liabilities:

 

 

 

Accounts payable

$

46,699

 

 

$

64,115

 

Other current liabilities

 

58,897

 

 

 

60,845

 

Deferred revenue

 

8,158

 

 

 

7,912

 

Commercial paper

 

3,993

 

 

 

9,982

 

Term debt

 

7,216

 

 

 

11,128

 

Total current liabilities

 

124,963

 

 

 

153,982

 

 

 

 

 

Non-current liabilities:

 

 

 

Term debt

 

98,071

 

 

 

98,959

 

Other non-current liabilities

 

51,730

 

 

 

49,142

 

Total non-current liabilities

 

149,801

 

 

 

148,101

 

Total liabilities

 

274,764

 

 

 

302,083

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

Shareholders’ equity:

 

 

 

Common stock and additional paid-in capital, $0.00001 par value: 50,400,000 shares authorized; 15,647,868 and 15,943,425 shares issued and outstanding, respectively

 

70,667

 

 

 

64,849

 

Retained earnings/(Accumulated deficit)

 

1,408

 

 

 

(3,068

)

Accumulated other comprehensive income/(loss)

 

(11,801

)

 

 

(11,109

)

Total shareholders’ equity

 

60,274

 

 

 

50,672

 

Total liabilities and shareholders’ equity

$

335,038

 

 

$

352,755

 

Apple Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(In millions)

 

 

Nine Months Ended

 

July 1,
2023

 

June 25,
2022

Cash, cash equivalents and restricted cash, beginning balances

$

24,977

 

 

$

35,929

 

 

 

 

 

Operating activities:

 

 

 

Net income

 

74,039

 

 

 

79,082

 

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

 

 

 

Depreciation and amortization

 

8,866

 

 

 

8,239

 

Share-based compensation expense

 

8,208

 

 

 

6,760

 

Other

 

(1,651

)

 

 

2,695

 

Changes in operating assets and liabilities:

 

 

 

Accounts receivable, net

 

7,609

 

 

 

4,561

 

Inventories

 

(2,570

)

 

 

1,049

 

Vendor non-trade receivables

 

13,111

 

 

 

4,789

 

Other current and non-current assets

 

(4,863

)

 

 

(3,289

)

Accounts payable

 

(16,790

)

 

 

(6,108

)

Other current and non-current liabilities

 

2,986

 

 

 

246

 

Cash generated by operating activities

 

88,945

 

 

 

98,024

 

 

 

 

 

Investing activities:

 

 

 

Purchases of marketable securities

 

(20,956

)

 

 

(70,178

)

Proceeds from maturities of marketable securities

 

27,857

 

 

 

24,203

 

Proceeds from sales of marketable securities

 

3,959

 

 

 

33,609

 

Payments for acquisition of property, plant and equipment

 

(8,796

)

 

 

(7,419

)

Other

 

(753

)

 

 

(1,352

)

Cash generated by/(used in) investing activities

 

1,311

 

 

 

(21,137

)

 

 

 

 

Financing activities:

 

 

 

Payments for taxes related to net share settlement of equity awards

 

(5,119

)

 

 

(5,915

)

Payments for dividends and dividend equivalents

 

(11,267

)

 

 

(11,138

)

Repurchases of common stock

 

(56,547

)

 

 

(64,974

)

Proceeds from issuance of term debt, net

 

5,228

 

 

 

 

Repayments of term debt

 

(11,151

)

 

 

(6,750

)

Proceeds from/(Repayments of) commercial paper, net

 

(5,971

)

 

 

4,970

 

Other

 

(508

)

 

 

(148

)

Cash used in financing activities

 

(85,335

)

 

 

(83,955

)

 

 

 

 

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

 

4,921

 

 

 

(7,068

)

Cash, cash equivalents and restricted cash, ending balances

$

29,898

 

 

$

28,861

 

 

 

 

 

Supplemental cash flow disclosure:

 

 

 

Cash paid for income taxes, net

$

7,020

 

 

$

12,251

 

Cash paid for interest

$

2,590

 

 

$

1,910

 

 

Press Contact:

Josh Rosenstock

Apple

jrosenstock@apple.com

(408) 862-1142

Investor Relations Contact:

Saori Casey

Apple

scasey@apple.com

(408) 974-3123

Source: Apple Inc.

Apple Inc.

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