Summary
Apple Inc.'s Q2 2020 filing (period ending March 28, 2020) reveals a modest 1% increase in total net sales to $58.3 billion, largely driven by strong growth in Services and Wearables, Home, and Accessories. However, this was partially offset by a decline in iPhone sales, signaling an early impact from the emerging COVID-19 pandemic. Despite macroeconomic headwinds, the company demonstrated resilience, with robust cash generation from operations and a significant commitment to returning capital to shareholders through substantial share repurchases and dividends. The filing highlights Apple's continued investment in research and development, which increased year-over-year, indicating a focus on future innovation. The company also faced some headwinds, including supply chain disruptions in China early in the quarter and subsequent demand weakness outside of China as the pandemic spread globally. Despite these challenges, Apple's diversified revenue streams, particularly the high-margin Services segment, and its strong financial position provide a solid foundation for navigating the uncertain economic environment.
Financial Highlights
55 data points| Revenue | $58.31B |
| Cost of Revenue | $35.94B |
| Gross Profit | $22.37B |
| R&D Expenses | $4.57B |
| SG&A Expenses | $4.95B |
| Operating Expenses | $9.52B |
| Operating Income | $12.85B |
| Interest Expense | $757.00M |
| Net Income | $11.25B |
| EPS (Basic) | $0.64 |
| EPS (Diluted) | $0.64 |
| Shares Outstanding (Basic) | 17.44B |
| Shares Outstanding (Diluted) | 17.62B |
Key Highlights
- 1Total net sales increased 1% year-over-year to $58.3 billion, driven by Services (+17%) and Wearables, Home, and Accessories (+23%).
- 2iPhone sales declined 7% year-over-year to $29.0 billion, impacted by the early stages of the COVID-19 pandemic.
- 3Services revenue continues to be a significant growth driver, up 17% to $13.3 billion, demonstrating the ecosystem's strength.
- 4Operating income saw a slight decrease of 4% to $12.9 billion, reflecting increased operating expenses.
- 5The company repurchased $18.5 billion of common stock and paid $3.4 billion in dividends during the quarter, underscoring its commitment to capital return.
- 6Research and Development expenses increased by 16% to $4.6 billion, signaling continued investment in future products and services.
- 7The company acknowledged the significant and ongoing adverse impacts of the COVID-19 pandemic on its business, supply chain, and demand.