01—Abstract
Summary
Summary of the 10-Q filed February 2, 2024. Cited figures are marked; the original filing is the authoritative source.
Apple Inc. reported robust financial results for the first quarter of fiscal year 2024, ending December 30, 2023.
Total net sales increased by 2% year-over-year to $119.58 billiona, driven primarily by a 6% rise in iPhone sales and an 11% surge in Services revenue. This growth was partially offset by declines in iPad and Wearables, Home and Accessories sales. The company demonstrated strong profitability, with net income rising to $33.92 billion, a significant increase from $29.99 billion in the prior year's comparable quarter.
Diluted earnings per share also saw a healthy increase to $2.18b from $1.88. Apple continued its aggressive capital return program, repurchasing approximately $20.5 billion of its common stock and paying out $3.8 billion in dividends, highlighting its commitment to shareholder value.
Despite some regional sales softness, particularly in Greater China (-13%c), the overall performance indicates resilience and continued demand for Apple's core products and growing Services segment. The company maintains a strong liquidity position, with substantial cash and marketable securities, and expresses confidence in its ability to meet future financial obligations and capital return commitments.
02—Key points
Key Highlights
- Total net sales for the quarter reached $119.58 billion, a 2% increase year-over-year.
- iPhone sales grew by 6% to $69.70 billion, driven by strong performance of Pro models.
- Services revenue demonstrated robust growth, up 11% to $23.12 billion, boosted by advertising, video, and cloud services.
- Net income increased significantly to $33.92 billion, up from $29.99 billion in the prior year's quarter.
- Diluted earnings per share (EPS) rose to $2.18 from $1.88 year-over-year.
- Apple repurchased approximately $20.5 billion of its common stock during the quarter, demonstrating a strong commitment to capital return.
- Sales in the Greater China region decreased by 13% to $20.82 billion, primarily due to lower sales of iPhone, iPad, and Wearables, Home and Accessories.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2024, Apple Inc. kept $0.28.
- Revenue$119.58B100.0%
- Cost of revenue−$64.72B54.1%
- Gross profit$54.85B45.9%
- Operating costs−$14.48B12.1%
- Operating income$40.37B33.8%
- Interest, other & tax−$6.46B5.4%
- Net income$33.92B28.4%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2024filed February 2, 2024Financial Statements
Q1 FY2024 against Q1 FY2023
| Line item | Q1 FY2024Q1 FY2023 | Change |
|---|---|---|
| Revenue | $119.58B$117.15B | +2.1% |
| Cost of Revenue | $64.72B$66.82B | −3.1% |
| Gross Profit | $54.85B$50.33B | +9.0% |
| R&D Expenses | $7.70B$7.71B | −0.2% |
| SG&A Expenses | $6.79B$6.61B | +2.7% |
| Operating Expenses | $14.48B$14.32B | +1.2% |
| Operating Income | $40.37B$36.02B | +12.1% |
| Net Income | $33.92B$30.00B | +13.1% |
| EPS (Basic) | $2.19$1.89 | +15.9% |
| EPS (Diluted) | $2.18$1.88 | +16.0% |
| Shares Outstanding (Basic) | 15.51B15.89B | −2.4% |
| Shares Outstanding (Diluted) | 15.58B15.96B | −2.4% |
05—Questions
Frequently Asked Questions
What was Apple's overall financial performance in the quarter?
Apple reported a 2% increase in total net sales, reaching $119.58 billion for the quarter ending December 30, 2023. Net income also saw a substantial rise to $33.92 billion, with diluted earnings per share increasing to $2.18. This indicates a strong quarter with top-line growth and improved profitability.
Which product categories performed well, and which faced challenges?
The iPhone segment was a strong performer, with sales increasing by 6% to $69.70 billion, largely due to Pro models. The Services segment also showed impressive growth, up 11% to $23.12 billion. However, iPad sales declined by 25%, and Wearables, Home and Accessories saw an 11% decrease in sales compared to the prior year.
How is Apple managing shareholder returns?
Apple continues to actively return capital to shareholders. In this quarter, the company repurchased approximately $20.5 billion of its common stock and paid $3.8 billion in dividends and dividend equivalents. This reflects a continued strategy of enhancing shareholder value through buybacks and dividends.
What are the key regional performance trends?
The Americas and Europe regions showed sales growth of 2% and 10% respectively, benefiting from iPhone and Services sales. Conversely, Greater China experienced a significant 13% decline in net sales, attributed to lower iPhone, iPad, and Wearables, Home and Accessories sales. Japan also saw a dip due to currency fluctuations impacting iPhone sales.
06—Continue