10-QPeriod: Q3 FY2024

Apple Inc. Quarterly Report for Q3 Ended Jun 29, 2024

Filed August 2, 2024For Securities:AAPL

Summary

Apple Inc. reported strong financial results for the fiscal third quarter ending June 29, 2024, demonstrating revenue growth driven primarily by its Services segment and improved performance in key product categories like iPad. Total net sales increased by 5% year-over-year to $85.8 billion, with Services revenue showing a significant 14% uplift. While iPhone sales remained relatively flat, the company saw substantial growth in iPad sales, particularly in the current quarter. Gross margin improved significantly to 46.3% from 44.5% in the prior year period, reflecting increased Services profitability and cost efficiencies in products. Net income rose to $21.4 billion, a 7.9% increase compared to the same quarter last year. For the first nine months of fiscal 2024, total net sales grew 1% to $296.1 billion, again propelled by a 13% increase in Services revenue. The company continues to execute its capital return program, repurchasing $70.0 billion of common stock and paying $11.4 billion in dividends year-to-date. Despite ongoing legal and regulatory scrutiny, particularly concerning the Digital Markets Act in Europe and antitrust lawsuits in the U.S., Apple's financial performance remains robust, underscoring the resilience of its business model and the continued demand for its ecosystem of products and services.

Financial Highlights

51 data points
Beta

Revenue

$85.78B

46.3% Gross Margin

Net Income

$21.45B

25.0% Net Margin

EPS (Diluted)

$1.40

Total Assets

$331.61B

Cash & Equivalents

$26.64B

Free Cash Flow

$26.71B

Financial Statements
Beta
Revenue$85.78B
Cost of Revenue$46.10B
Gross Profit$39.68B
R&D Expenses$8.01B
SG&A Expenses$6.32B
Operating Expenses$14.33B
Operating Income$25.35B
Net Income$21.45B
EPS (Basic)$1.40
EPS (Diluted)$1.40
Shares Outstanding (Basic)15.29B
Shares Outstanding (Diluted)15.35B

Key Highlights

  • 1Total net sales increased 5% year-over-year to $85.8 billion in Q3 FY24.
  • 2Services revenue grew 14% year-over-year to $24.2 billion in Q3 FY24.
  • 3iPad sales saw a significant 24% increase year-over-year in Q3 FY24.
  • 4Gross margin improved to 46.3% in Q3 FY24, up from 44.5% in Q3 FY23.
  • 5Net income increased by 7.9% to $21.4 billion in Q3 FY24.
  • 6Apple repurchased $26.0 billion of its common stock and paid $3.9 billion in dividends in Q3 FY24.
  • 7Greater China net sales decreased by 7% year-over-year in Q3 FY24, primarily due to lower iPhone sales.

Frequently Asked Questions

Apple's revenue growth in the fiscal third quarter ending June 29, 2024, was primarily driven by a strong performance in its Services segment, which saw a 14% year-over-year increase. Additionally, robust sales of iPads, up 24% year-over-year, contributed significantly to the overall 5% revenue growth.

Apple continues to actively return capital to shareholders. In the third quarter of fiscal 2024, the company repurchased $26.0 billion of its common stock and paid dividends and dividend equivalents totaling $3.9 billion. Year-to-date, share repurchases amounted to $70.0 billion and dividends totaled $11.4 billion.

The company faces ongoing legal and regulatory challenges. These include investigations under the EU's Digital Markets Act concerning App Store rules and practices, and a civil antitrust lawsuit filed by the U.S. Department of Justice alleging monopolization. Additionally, Epic Games' lawsuit regarding App Store practices continues, with a pending motion related to Apple's compliance plan.

iPhone net sales were relatively flat, decreasing by 1% year-over-year in the third quarter of fiscal 2024. This performance was also a factor in the 7% decrease in net sales for the Greater China region.