Apple reports third quarter results

Rhea-AI Summary

Apple reported strong financial results for its fiscal 2024 third quarter, setting new June quarter records for revenue and earnings per share (EPS). The company posted quarterly revenue of $85.8 billion, up 5% year over year, and quarterly EPS of $1.40, up 11% year over year. Services revenue reached an all-time high.

CEO Tim Cook highlighted the announcement of Apple Intelligence, a new personal intelligence system incorporating generative AI across Apple devices. CFO Luca Maestri noted that the company generated nearly $29 billion in operating cash flow and returned over $32 billion to shareholders. Apple's installed base of active devices reached a new all-time high across all geographic segments.

The board declared a cash dividend of $0.25 per share, payable on August 15, 2024.

Positive

• Quarterly revenue increased 5% year over year to $85.8 billion
• Earnings per share grew 11% year over year to $1.40
• Services revenue reached an all-time high
• Operating cash flow of nearly $29 billion
• Installed base of active devices reached new all-time high in all geographic segments
• $32 billion returned to shareholders

Negative

• None.

Insights

Financial Analyst

Apple's Q3 2024 results demonstrate robust financial performance, with notable highlights including:

• Revenue of $85.8 billion, up 5% year-over-year
• Earnings per share of $1.40, an 11% increase
• Operating cash flow of nearly $29 billion
• Shareholder returns exceeding $32 billion

The 5% revenue growth is particularly impressive given the challenging macroeconomic environment. This growth, coupled with the 11% EPS increase, suggests effective cost management and operational efficiency. The substantial operating cash flow and shareholder returns underscore Apple's financial strength and commitment to shareholder value.

The all-time high in active devices across all geographic segments is a key indicator of Apple's expanding ecosystem, which could drive future services revenue and customer loyalty. However, investors should note that while services revenue reached a new all-time high, specific figures weren't provided, making it difficult to assess the segment's growth rate.

The announced $0.25 per share dividend maintains Apple's appeal to income-focused investors. While this demonstrates financial stability, it's worth noting that significant cash reserves are being allocated to shareholder returns, potentially at the expense of increased R&D or strategic acquisitions.

Overall, these results paint a picture of a company maintaining strong financial health and market position, but investors should keep an eye on future innovation and market expansion strategies to ensure continued growth in an increasingly competitive tech landscape.

Tech Expert

Apple's Q3 2024 results highlight the company's continued dominance in the tech sector, but also point to some intriguing developments:

The announcement of Apple Intelligence, described as a "breakthrough personal intelligence system" with generative AI at its core, marks a significant shift in Apple's AI strategy. This move aligns Apple with competitors who have been aggressively pushing AI integration, potentially addressing concerns about the company falling behind in this important area.

The emphasis on privacy in conjunction with AI is quintessentially Apple, likely to resonate with their privacy-conscious user base. However, the real test will be in the implementation and user experience of these AI features across iPhone, iPad and Mac platforms.

The all-time high in active devices across all geographic segments is a testament to Apple's ecosystem strength. This growth in the installed base is important for several reasons:

• It provides a larger audience for Apple's services, potentially driving further growth in this high-margin segment.
• It creates opportunities for upselling and cross-selling within the Apple ecosystem.
• It reinforces Apple's platform for developers, maintaining its attractiveness for app creation and innovation.

While the financial results are strong, the lack of specific product line breakdowns makes it challenging to assess which hardware categories are driving growth. As the smartphone market matures, investors should watch for signals of diversification in Apple's revenue streams, particularly in emerging categories like AR/VR with the upcoming Vision Pro.

The continued investment in innovation, as mentioned by Tim Cook, will be important for Apple's long-term competitiveness, especially as it ventures into new territories like spatial computing and potentially automotive technology.

June quarter records for Revenue and EPS

Services revenue reaches new all-time high

CUPERTINO, Calif.--(BUSINESS WIRE)-- Apple® today announced financial results for its fiscal 2024 third quarter ended June 29, 2024. The Company posted quarterly revenue of $85.8 billion, up 5 percent year over year, and quarterly earnings per diluted share of $1.40, up 11 percent year over year.

“Today Apple is reporting a new June quarter revenue record of $85.8 billion, up 5 percent from a year ago,” said Tim Cook, Apple’s CEO. “During the quarter, we were excited to announce incredible updates to our software platforms at our Worldwide Developers Conference, including Apple Intelligence, a breakthrough personal intelligence system that puts powerful, private generative AI models at the core of iPhone, iPad, and Mac. We very much look forward to sharing these tools with our users, and we continue to invest significantly in the innovations that will enrich our customers’ lives, while leading with the values that drive our work.”

“During the quarter, our record business performance generated EPS growth of 11 percent and nearly $29 billion in operating cash flow, allowing us to return over $32 billion to shareholders,” said Luca Maestri, Apple’s CFO. “We are also very pleased that our installed base of active devices reached a new all-time high in all geographic segments, thanks to very high levels of customer satisfaction and loyalty.”

Apple’s board of directors has declared a cash dividend of $0.25 per share of the Company’s common stock. The dividend is payable on August 15, 2024 to shareholders of record as of the close of business on August 12, 2024.

Apple will provide live streaming of its Q3 2024 financial results conference call beginning at 2:00 p.m. PT on August 1, 2024 at apple.com/investor/earnings-call. The webcast will be available for replay for approximately two weeks thereafter.

Apple periodically provides information for investors on its corporate website, apple.com, and its investor relations website, investor.apple.com. This includes press releases and other information about financial performance, reports filed or furnished with the SEC, information on corporate governance, and details related to its annual meeting of shareholders.

This press release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include without limitation those about payment of the Company’s quarterly dividend and future business plans. These statements involve risks and uncertainties, and actual results may differ materially from any future results expressed or implied by the forward-looking statements. Risks and uncertainties include without limitation: effects of global and regional economic conditions, including as a result of government policies, war, terrorism, natural disasters, and public health issues; risks relating to the design, manufacture, introduction, and transition of products and services in highly competitive and rapidly changing markets, including from reliance on third parties for components, technology, manufacturing, applications, and content; risks relating to information technology system failures, network disruptions, and failure to protect, loss of, or unauthorized access to, or release of, data; and effects of unfavorable legal proceedings, government investigations, and complex and changing laws and regulations. More information on these risks and other potential factors that could affect the Company’s business, reputation, results of operations, financial condition, and stock price is included in the Company’s filings with the SEC, including in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings. The Company assumes no obligation to update any forward-looking statements, which speak only as of the date they are made.

Apple revolutionized personal technology with the introduction of the Macintosh in 1984. Today, Apple leads the world in innovation with iPhone, iPad, Mac, AirPods, Apple Watch, and Apple Vision Pro. Apple’s six software platforms — iOS, iPadOS, macOS, watchOS, visionOS, and tvOS — provide seamless experiences across all Apple devices and empower people with breakthrough services including the App Store, Apple Music, Apple Pay, iCloud, and Apple TV+. Apple’s more than 150,000 employees are dedicated to making the best products on earth and to leaving the world better than we found it.

NOTE TO EDITORS: For additional information visit Apple Newsroom (www.apple.com/newsroom), or email Apple’s Media Helpline at media.help@apple.com.

© 2024 Apple Inc. All rights reserved. Apple and the Apple logo are trademarks of Apple. Other company and product names may be trademarks of their respective owners.

Apple Inc. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In millions, except number of shares, which are reflected in thousands, and per-share amounts)
	Three Months Ended							Nine Months Ended
	June 29, 2024			July 1, 2023				June 29, 2024			July 1, 2023
Net sales:
Products	$	61,564		$	60,584			$	224,908		$	230,901
Services		24,213			21,213				71,197			62,886
Total net sales (1)		85,777			81,797				296,105			293,787
Cost of sales:
Products		39,803			39,136				140,667			146,696
Services		6,296			6,248				18,634			18,370
Total cost of sales		46,099			45,384				159,301			165,066
Gross margin		39,678			36,413				136,804			128,721
Operating expenses:
Research and development		8,006			7,442				23,605			22,608
Selling, general and administrative		6,320			5,973				19,574			18,781
Total operating expenses		14,326			13,415				43,179			41,389
Operating income		25,352			22,998				93,625			87,332
Other income/(expense), net		142			(265	)			250			(594	)
Income before provision for income taxes		25,494			22,733				93,875			86,738
Provision for income taxes		4,046			2,852				14,875			12,699
Net income	$	21,448		$	19,881			$	79,000		$	74,039
Earnings per share:
Basic	$	1.40		$	1.27			$	5.13		$	4.69
Diluted	$	1.40		$	1.26			$	5.11		$	4.67
Shares used in computing earnings per share:
Basic		15,287,521			15,697,614				15,401,047			15,792,497
Diluted		15,348,175			15,775,021				15,463,175			15,859,263
(1) Net sales by reportable segment:
Americas	$	37,678		$	35,383			$	125,381		$	122,445
Europe		21,884			20,205				76,404			71,831
Greater China		14,728			15,758				51,919			57,475
Japan		5,097			4,821				19,126			18,752
Rest of Asia Pacific		6,390			5,630				23,275			23,284
Total net sales	$	85,777		$	81,797			$	296,105		$	293,787
(1) Net sales by category:
iPhone	$	39,296		$	39,669			$	154,961		$	156,778
Mac		7,009			6,840				22,240			21,743
iPad		7,162			5,791				19,744			21,857
Wearables, Home and Accessories		8,097			8,284				27,963			30,523
Services		24,213			21,213				71,197			62,886
Total net sales	$	85,777		$	81,797			$	296,105		$	293,787

Apple Inc. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In millions, except number of shares, which are reflected in thousands, and par value)
	June 29, 2024				September 30, 2023
ASSETS:
Current assets:
Cash and cash equivalents	$	25,565			$	29,965
Marketable securities		36,236				31,590
Accounts receivable, net		22,795				29,508
Vendor non-trade receivables		20,377				31,477
Inventories		6,165				6,331
Other current assets		14,297				14,695
Total current assets		125,435				143,566
Non-current assets:
Marketable securities		91,240				100,544
Property, plant and equipment, net		44,502				43,715
Other non-current assets		70,435				64,758
Total non-current assets		206,177				209,017
Total assets	$	331,612			$	352,583
LIABILITIES AND SHAREHOLDERS’ EQUITY:
Current liabilities:
Accounts payable	$	47,574			$	62,611
Other current liabilities		60,889				58,829
Deferred revenue		8,053				8,061
Commercial paper		2,994				5,985
Term debt		12,114				9,822
Total current liabilities		131,624				145,308
Non-current liabilities:
Term debt		86,196				95,281
Other non-current liabilities		47,084				49,848
Total non-current liabilities		133,280				145,129
Total liabilities		264,904				290,437
Commitments and contingencies
Shareholders’ equity:
Common stock and additional paid-in capital, $0.00001 par value: 50,400,000 shares authorized; 15,222,259 and 15,550,061 shares issued and outstanding, respectively		79,850				73,812
Accumulated deficit		(4,726	)			(214	)
Accumulated other comprehensive loss		(8,416	)			(11,452	)
Total shareholders’ equity		66,708				62,146
Total liabilities and shareholders’ equity	$	331,612			$	352,583

Apple Inc. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In millions)
	Nine Months Ended
	June 29, 2024				July 1, 2023
Cash, cash equivalents and restricted cash, beginning balances	$	30,737			$	24,977
Operating activities:
Net income		79,000				74,039
Adjustments to reconcile net income to cash generated by operating activities:
Depreciation and amortization		8,534				8,866
Share-based compensation expense		8,830				8,208
Other		(1,964	)			(1,651	)
Changes in operating assets and liabilities:
Accounts receivable, net		6,697				7,609
Vendor non-trade receivables		11,100				13,111
Inventories		41				(2,570	)
Other current and non-current assets		(5,626	)			(4,863	)
Accounts payable		(15,171	)			(16,790	)
Other current and non-current liabilities		2				2,986
Cash generated by operating activities		91,443				88,945
Investing activities:
Purchases of marketable securities		(38,074	)			(20,956	)
Proceeds from maturities of marketable securities		39,838				27,857
Proceeds from sales of marketable securities		7,382				3,959
Payments for acquisition of property, plant and equipment		(6,539	)			(8,796	)
Other		(1,117	)			(753	)
Cash generated by investing activities		1,490				1,311
Financing activities:
Payments for taxes related to net share settlement of equity awards		(5,163	)			(5,119	)
Payments for dividends and dividend equivalents		(11,430	)			(11,267	)
Repurchases of common stock		(69,866	)			(56,547	)
Proceeds from issuance of term debt, net		—				5,228
Repayments of term debt		(7,400	)			(11,151	)
Repayments of commercial paper, net		(2,985	)			(5,971	)
Other		(191	)			(508	)
Cash used in financing activities		(97,035	)			(85,335	)
Increase/(Decrease) in cash, cash equivalents and restricted cash		(4,102	)			4,921
Cash, cash equivalents and restricted cash, ending balances	$	26,635			$	29,898
Supplemental cash flow disclosure:
Cash paid for income taxes, net	$	19,230			$	7,020

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240801799244/en/

Press Contact:

Josh Rosenstock

Apple

jrosenstock@apple.com

(408) 862-1142

Investor Relations Contact:

Suhasini Chandramouli

Apple

suhasini@apple.com

(408) 974-3123

Source: Apple Inc.

FAQ

What was Apple's (AAPL) revenue for Q3 2024?

Apple reported quarterly revenue of $85.8 billion for Q3 2024, up 5% year over year.

How much did Apple's (AAPL) earnings per share grow in Q3 2024?

Apple's earnings per diluted share grew 11% year over year to $1.40 in Q3 2024.

What new technology did Apple (AAPL) announce at WWDC 2024?

Apple announced Apple Intelligence, a personal intelligence system incorporating generative AI across iPhone, iPad, and Mac.

How much cash did Apple (AAPL) return to shareholders in Q3 2024?

Apple returned over $32 billion to shareholders during Q3 2024.

What is the amount of Apple's (AAPL) cash dividend for Q3 2024?

Apple declared a cash dividend of $0.25 per share, payable on August 15, 2024.