01—Abstract
Summary
Summary of the 10-K filed October 29, 2021. Cited figures are marked; the original filing is the authoritative source.
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 billiona, 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 billionb 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.
02—Key points
Key Highlights
- Total net sales surged by 33% year-over-year to $365.8 billion, indicating strong market demand and successful product cycles.
- iPhone revenue increased significantly (39%) to $192.0 billion, driven by the launch of new iPhone models.
- The Services segment continued its impressive growth trajectory, with net sales up 27% to $68.4 billion, underscoring the increasing contribution of Apple's ecosystem.
- Apple significantly increased its capital return program, authorizing up to $315 billion in share repurchases and raising its quarterly dividend.
- The company actively repurchased $85.5 billion of its common stock during the fiscal year.
- Despite global supply chain disruptions and component shortages, Apple managed to drive substantial revenue growth.
- Geographic performance was strong across the board, with Greater China showing exceptional growth of 70% in net sales year-over-year.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2021, Apple Inc. kept $0.26.
- Revenue$365.82B100.0%
- Cost of revenue−$212.98B58.2%
- Gross profit$152.84B41.8%
- Operating costs−$43.89B12.0%
- Operating income$108.95B29.8%
- Interest, other & tax−$14.27B3.9%
- Net income$94.68B25.9%
Where FY2021 revenue went
$365.82B- Cost of revenue: $212.98B, 58% of revenue
- Net income: $94.68B, 26% of revenue
- R&D: $21.91B, 6.0% of revenue
- SG&A: $21.97B, 6.0% of revenue
- Interest, other & tax: $14.27B, 3.9% of revenue
Kept 26% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2021filed October 29, 2021Financial Statements
FY2021 against FY2020
| Line item | FY2021FY2020 | Change |
|---|---|---|
| Revenue | $365.82B$274.51B | +33.3% |
| Cost of Revenue | $212.98B$169.56B | +25.6% |
| Gross Profit | $152.84B$104.96B | +45.6% |
| R&D Expenses | $21.91B$18.75B | +16.9% |
| SG&A Expenses | $21.97B$19.92B | +10.3% |
| Operating Expenses | $43.89B$38.67B | +13.5% |
| Operating Income | $108.95B$66.29B | +64.4% |
| Interest Expense | $2.65B$2.87B | −7.9% |
| Net Income | $94.68B$57.41B | +64.9% |
| EPS (Basic) | $5.67$3.31 | +71.3% |
| EPS (Diluted) | $5.61$3.28 | +71.0% |
| Shares Outstanding (Basic) | 16.70B17.35B | −3.8% |
| Shares Outstanding (Diluted) | 16.86B17.53B | −3.8% |
05—Questions
Frequently Asked Questions
What were the primary drivers of Apple's revenue growth in fiscal year 2021?
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.
What are the key risks Apple highlighted in its 10-K filing for 2021?
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.
How did Apple manage its cash and capital allocation during fiscal year 2021?
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.
What is the significance of the Services segment's performance for Apple?
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.
06—Continue