01—Abstract
Summary
Summary of the 10-K filed October 26, 2011. Cited figures are marked; the original filing is the authoritative source.
Apple Inc.'s 2011 Form 10-K highlights a period of exceptional growth and market leadership, driven by the continued success of its iconic iPhone and the burgeoning iPad.
The company demonstrated remarkable revenue expansion, a testament to its innovative product pipeline and effective global distribution strategy. Apple's commitment to integrating hardware, software, and services provides a distinct competitive advantage, allowing it to capture significant market share across its product categories. Financially, Apple showcased robust profitability and a rapidly growing cash reserve, underscoring its strong operational performance and financial health.
The company's strategic focus on research and development, coupled with its expanding retail footprint, positions it for sustained growth, although it also faces intense competition and various supply chain and market risks. Investors are presented with a picture of a company at the forefront of technological innovation, with strong execution and a compelling product ecosystem.
02—Key points
Key Highlights
- Exceptional revenue growth of 66% year-over-year to $108.2 billion in fiscal year 2011, driven by strong sales of iPhone and iPad.
- iPhone sales nearly doubled, accounting for 43% of total net sales, with 72.3 million units sold.
- iPad, launched in Q3 2010, generated $20.4 billion in revenue with 32.4 million units sold in its first full fiscal year.
- Mac sales increased by 25% to $21.8 billion, with strong demand for MacBook Air and MacBook Pro.
- Significant growth in cash, cash equivalents, and marketable securities, reaching $81.6 billion.
- Continued investment in Research and Development, increasing by 36% to $2.4 billion, underscoring commitment to innovation.
- Expansion of global distribution, with a growing number of retail stores and increased carrier partnerships worldwide.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2011, Apple Inc. kept $0.24.
- Revenue$108.25B100.0%
- Cost of revenue−$64.43B59.5%
- Gross profit$43.82B40.5%
- Operating costs−$10.03B9.3%
- Operating income$33.79B31.2%
- Interest, other & tax−$7.87B7.3%
- Net income$25.92B23.9%
Where FY2011 revenue went
$108.25B- Cost of revenue: $64.43B, 60% of revenue
- Net income: $25.92B, 24% of revenue
- R&D: $2.43B, 2.2% of revenue
- SG&A: $7.60B, 7.0% of revenue
- Interest, other & tax: $7.87B, 7.3% of revenue
Kept 24% as net incomeR&D $2.43B · 2.2%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2011filed October 26, 2011Financial Statements
FY2011 against FY2010
| Line item | FY2011FY2010 | Change |
|---|---|---|
| Revenue | $108.25B$65.22B | +66.0% |
| Cost of Revenue | $64.43B$39.54B | +62.9% |
| Gross Profit | $43.82B$25.68B | +70.6% |
| R&D Expenses | $2.43B$1.78B | +36.3% |
| SG&A Expenses | $7.60B$5.52B | +37.7% |
| Operating Expenses | $10.03B$7.30B | +37.4% |
| Operating Income | $33.79B$18.39B | +83.8% |
| Interest Expense | $0— | — |
| Net Income | $25.92B$14.01B | +85.0% |
| EPS (Basic) | $1.00$0.55 | +82.0% |
| EPS (Diluted) | $0.99$0.54 | +82.7% |
| Shares Outstanding (Basic) | 25.88B25.46B | +1.6% |
| Shares Outstanding (Diluted) | 26.23B25.89B | +1.3% |
05—Questions
Frequently Asked Questions
What were Apple's primary growth drivers in fiscal year 2011?
Apple's primary growth drivers in fiscal year 2011 were the iPhone and the iPad. iPhone sales saw an 87% increase, driven by strong demand for the iPhone 4 and expanded distribution. The iPad, in its first full fiscal year, generated $20.4 billion in sales, showcasing massive demand and contribution to revenue.
How is Apple managing its significant cash reserves?
Apple held approximately $81.6 billion in cash, cash equivalents, and marketable securities as of September 24, 2011. The company indicated it anticipates retaining earnings for business operations and had no long-term debt. A significant portion of these funds was held by foreign subsidiaries.
What are the key risks highlighted by Apple in this filing?
Key risks highlighted include intense competition in the mobile and personal computer markets, reliance on a limited number of suppliers for components, the need for continuous innovation and successful product introductions, inventory management risks, potential quality issues, and risks associated with international operations and currency fluctuations. Apple also faces ongoing legal proceedings related to antitrust matters.
What is Apple's strategy regarding its retail stores?
Apple's strategy includes continued expansion of its retail store network, with 40 new stores opened in 2011. These stores are designed to provide a high-quality customer experience, showcase products, and offer sales and post-sales support. The company also invests in programs to enhance third-party reseller sales.
06—Continue