10-KPeriod: FY2021

Apple Inc. Annual Report, Year Ended Sep 25, 2021

Filed October 29, 2021For Securities:AAPL

Summary

Apple Inc.'s 2021 10-K filing reveals a robust year of growth, with total net sales increasing by a significant 33% to $365.8 billion, driven by strong performance across all product and service categories. The iPhone remained the dominant revenue driver, showing substantial year-over-year growth due to new model launches. The Services segment also demonstrated impressive expansion, increasing net sales by 27% and highlighting the growing importance of Apple's ecosystem. The company continued its commitment to shareholder returns, increasing its quarterly dividend and repurchasing approximately $85.5 billion of its common stock. Despite facing ongoing challenges related to the COVID-19 pandemic, including supply chain disruptions and component shortages, Apple demonstrated resilience. The company's financial position remains strong, supported by substantial cash reserves and access to debt markets, enabling continued investment in research and development and strategic initiatives.

Financial Highlights

55 data points
Beta

Revenue

$365.82B

41.8% Gross Margin

Net Income

$94.68B

25.9% Net Margin

EPS (Diluted)

$5.61

Total Assets

$351.00B

Cash & Equivalents

$34.94B

Free Cash Flow

$92.95B

Financial Statements
Beta
Revenue$365.82B
Cost of Revenue$212.98B
Gross Profit$152.84B
R&D Expenses$21.91B
SG&A Expenses$21.97B
Operating Expenses$43.89B
Operating Income$108.95B
Interest Expense$2.65B
Net Income$94.68B
EPS (Basic)$5.67
EPS (Diluted)$5.61
Shares Outstanding (Basic)16.70B
Shares Outstanding (Diluted)16.86B

Key Highlights

  • 1Total net sales surged by 33% year-over-year to $365.8 billion, indicating strong market demand and successful product cycles.
  • 2iPhone revenue increased significantly (39%) to $192.0 billion, driven by the launch of new iPhone models.
  • 3The Services segment continued its impressive growth trajectory, with net sales up 27% to $68.4 billion, underscoring the increasing contribution of Apple's ecosystem.
  • 4Apple significantly increased its capital return program, authorizing up to $315 billion in share repurchases and raising its quarterly dividend.
  • 5The company actively repurchased $85.5 billion of its common stock during the fiscal year.
  • 6Despite global supply chain disruptions and component shortages, Apple managed to drive substantial revenue growth.
  • 7Geographic performance was strong across the board, with Greater China showing exceptional growth of 70% in net sales year-over-year.

Frequently Asked Questions

Apple's revenue growth in fiscal year 2021 was primarily driven by strong sales of its latest iPhone models, a significant increase in Mac and iPad sales due to new product releases powered by Apple Silicon, and continued expansion in the Wearables, Home, and Accessories category. The Services segment also played a crucial role, with notable growth in areas like advertising, the App Store, and cloud services.

Apple highlighted several key risks, including the ongoing impact of the COVID-19 pandemic on its business, supply chain disruptions, macroeconomic volatility (such as inflation, trade disputes, and currency fluctuations), intense competition in its product and service markets, reliance on key suppliers and outsourcing partners, risks associated with new product introductions, and legal and regulatory scrutiny, particularly concerning its App Store practices.

Apple maintained a strong liquidity position with substantial cash reserves. The company continued its commitment to returning capital to shareholders by increasing its quarterly dividend and significantly expanding its share repurchase program, buying back $85.5 billion of its stock during the fiscal year. This reflects management's confidence in the company's financial health and future prospects.

The Services segment's continued strong growth (27% increase in net sales) is strategically important for Apple. It diversifies revenue streams beyond hardware sales, provides a more predictable and recurring revenue base, and enhances customer loyalty by deepening engagement within Apple's ecosystem. The high gross margins in the Services segment also contribute positively to overall profitability.