Apple Reports First Quarter Profit of $183 Million
Revenues up 37 percent; Units up 46 percent Profits Before Non-recurring Items up 45 percent
Consolidated Statements
CUPERTINO, California-January 19, 2000-AppleŽ today announced financial results for its fiscal 2000 first quarter that ended January 1, 2000. For the quarter, the Company posted a net profit of $183 million, or $1.03 per diluted share. These results compare to a net profit of $152 million, or $.95 per diluted share, achieved in the year-ago quarter. Revenues for the quarter were $2.34 billion, up 37 percent from the year-ago quarter, and gross margins were 25.9 percent, down from 28.2 percent in the year-ago quarter. International sales accounted for 51 percent of the quarter's revenues.
The quarter's results included a $5 million net favorable impact from non-recurring items, including an after-tax gain of $101 million resulting from the sale of approximately five million shares of ARM Holdings plc., a net restructuring charge of $6 million, and a one-time charge for a special executive bonus of $90 million. Without non-recurring items, the Company's net profit for the quarter would have been $178 million, up 45 percent from the year-ago-quarter, and earnings per diluted share would have been $1.00, up 28 percent from the year-ago quarter.
Sales of 1,377,000 systems including over 700,000 iMac(tm) consumer desktops and 235,000 iBook(tm) consumer portables, drove unit growth of 46 percent year-over-year, outpacing the industry average. IDC is currently forecasting total worldwide industry unit growth at 17 percent for the December quarter compared with the year-ago quarter.
"We are delighted that Apple is delivering strong growth on every front-revenues, profits and units-and in particular that our unit growth last quarter was 2.5 times higher than the industry average, which leads directly to market share growth," said Steve Jobs, Apple's CEO. "Apple also continues to deliver the best asset management in the industry, ending the quarter with less than one day of inventory."
"Strong earnings combined with superb operational efficiency resulted in positive cash flow from operations of $373 million," said Fred Anderson, Apple's CFO. "Apple finished the quarter with over $3.6 billion in cash and short-term investments, and over $5 billion if the Company's investments in ARM and Akamai Technologies, Inc. are included."
Except for the historical information contained herein, the statements in this press release are forward-looking statements that involve risks and uncertainties. Potential risks and uncertainties include, without limitation, continued competitive pressures in the marketplace; the effect competitive and economic factors and the Company's reaction to them may have on consumer and business buying decisions with respect to the Company's products; the ability of the Company to make timely delivery of new products and successful technological innovations to the marketplace; the continued availability of certain components and services essential to the Company's business currently obtained by the Company from sole or limited sources; the ability of the Company to successfully evolve its operating system, and impact on the Company's business due to internal systems or systems of suppliers, infrastructure providers and other third parties adversely affected by year 2000 problems. More information on potential factors that could affect the Company's financial results is included from time to time in the Company's public reports filed with the SEC, including the Company's Form 10-K for the 1999 fiscal year, and the Company's Form 10-Q for the quarter ended January 1, 2000, to be filed with the SEC.
Apple ignited the personal computer revolution in the 1970s with the Apple II and reinvented the personal computer in the 1980s with the Macintosh. Apple is committed to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through its innovative hardware, software and Internet offerings.
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