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Exhibit


Exhibit 99.1


Apple Reports Third Quarter Results

Revenue Growth of 7 Percent and EPS Growth of 17 Percent

Services Revenue Hits All-Time Quarterly Record

CUPERTINO, California — August 1, 2017 — Apple® today announced financial results for its fiscal 2017 third quarter ended July 1, 2017. The Company posted quarterly revenue of $45.4 billion and quarterly earnings per diluted share of $1.67. These results compare to revenue of $42.4 billion and earnings per diluted share of $1.42 in the year-ago quarter. International sales accounted for 61 percent of the quarter’s revenue.

“With revenue up 7 percent year-over-year, we’re happy to report our third consecutive quarter of accelerating growth and an all-time quarterly record for Services revenue,” said Tim Cook, Apple’s CEO. “We hosted an incredibly successful Worldwide Developers Conference in June, and we’re very excited about the advances in iOS, macOS, watchOS and tvOS coming this fall.”

“We reported unit and revenue growth in all our product categories in the June quarter, driving 17 percent growth in earnings per share,” said Luca Maestri, Apple’s CFO. “We also returned $11.7 billion to investors during the quarter, bringing cumulative capital returns under our program to almost $223 billion.”

Apple is providing the following guidance for its fiscal 2017 fourth quarter:

revenue between $49 billion and $52 billion
gross margin between 37.5 percent and 38 percent
operating expenses between $6.7 billion and $6.8 billion
other income/(expense) of $500 million
tax rate of 25.5 percent

Apple’s board of directors has declared a cash dividend of $0.63 per share of the Company’s common stock. The dividend is payable on August 17, 2017 to shareholders of record as of the close of business on August 14, 2017.

Apple will provide live streaming of its Q3 2017 financial results conference call beginning at 2:00 p.m. PDT on August 1, 2017 at www.apple.com/investor/earnings-call/. This webcast will also be available for replay for approximately two weeks thereafter.






This press release contains forward-looking statements including without limitation those about the Company’s estimated revenue, gross margin, operating expenses, other income/(expense), tax rate, and plans for return of capital. These statements involve risks and uncertainties, and actual results may differ. Risks and uncertainties include without limitation the effect of competitive and economic factors, and the Company’s reaction to those factors, on consumer and business buying decisions with respect to the Company’s products; continued competitive pressures in the marketplace; the ability of the Company to deliver to the marketplace and stimulate customer demand for new programs, products, and technological innovations on a timely basis; the effect that product introductions and transitions, changes in product pricing or mix, and/or increases in component costs could have on the Company’s gross margin; the inventory risk associated with the Company’s need to order or commit to order product components in advance of customer orders; the continued availability on acceptable terms, or at all, of certain components and services essential to the Company’s business currently obtained by the Company from sole or limited sources; the effect that the Company’s dependency on manufacturing and logistics services provided by third parties may have on the quality, quantity or cost of products manufactured or services rendered; risks associated with the Company’s international operations; the Company’s reliance on third-party intellectual property and digital content; the potential impact of a finding that the Company has infringed on the intellectual property rights of others; the Company’s dependency on the performance of distributors, carriers and other resellers of the Company’s products; the effect that product and service quality problems could have on the Company’s sales and operating profits; the continued service and availability of key executives and employees; war, terrorism, public health issues, natural disasters, and other circumstances that could disrupt supply, delivery, or demand of products; and unfavorable results of legal proceedings. More information on potential factors that could affect the Company’s financial results is included from time to time in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s public reports filed with the SEC, including the Company’s Form 10-K for the fiscal year ended September 24, 2016, its Form 10-Q for the fiscal quarter ended December 31, 2016, its Form 10-Q for the fiscal quarter ended April 1, 2017, and its Form 10-Q for the quarter ended July 1, 2017 to be filed with the SEC. The Company assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates.

Apple revolutionized personal technology with the introduction of the Macintosh in 1984. Today, Apple leads the world in innovation with iPhone, iPad, Mac, Apple Watch and Apple TV. Apple’s four software platforms — iOS, macOS, watchOS and tvOS — provide seamless experiences across all Apple devices and empower people with breakthrough services including the App Store, Apple Music, Apple Pay and iCloud. Apple’s more than 100,000 employees are dedicated to making the best products on earth, and to leaving the world better than we found it.


Press Contact:
Kristin Huguet
Apple
khuguet@apple.com
(408) 974-2414

Investor Relations Contacts:
Nancy Paxton
Apple
paxton1@apple.com
(408) 974-5420

Joan Hoover
Apple
hoover1@apple.com
(408) 974-4570


NOTE TO EDITORS: For additional information visit Apple Newsroom (www.apple.com/newsroom), or call Apple’s Media Helpline at (408) 974-2042.


© 2017 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
 
July 1,
2017
 
June 25,
2016
 
July 1,
2017
 
June 25,
2016
Net sales
$
45,408

 
$
42,358

 
$
176,655

 
$
168,787

Cost of sales (1)
27,920

 
26,252

 
108,400

 
102,337

Gross margin
17,488

 
16,106

 
68,255

 
66,450

 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
Research and development (1)
2,937

 
2,560

 
8,584

 
7,475

Selling, general and administrative (1)
3,783

 
3,441

 
11,447

 
10,712

Total operating expenses
6,720

 
6,001

 
20,031

 
18,187

 
 
 
 
 
 
 
 
Operating income
10,768

 
10,105

 
48,224

 
48,263

Other income/(expense), net
540

 
364

 
1,948

 
921

Income before provision for income taxes
11,308

 
10,469

 
50,172

 
49,184

Provision for income taxes
2,591

 
2,673

 
12,535

 
12,511

Net income
$
8,717

 
$
7,796

 
$
37,637

 
$
36,673

 
 
 
 
 
 
 
 
Earnings per share:
 
 
 
 
 
 
 
Basic
$
1.68

 
$
1.43

 
$
7.18

 
$
6.66

Diluted
$
1.67

 
$
1.42

 
$
7.14

 
$
6.62

 
 
 
 
 
 
 
 
Shares used in computing earnings per share:
 
 
 
 
 
 
 
Basic
5,195,088

 
5,443,058

 
5,239,847

 
5,505,456

Diluted
5,233,499

 
5,472,781

 
5,274,394

 
5,535,931

 
 
 
 
 
 
 
 
Cash dividends declared per share
$
0.63

 
$
0.57

 
$
1.77

 
$
1.61

 
 
 
 
 
 
 
 
(1) Includes share-based compensation expense as follows:
Cost of sales
$
216

 
$
188

 
$
662

 
$
583

Research and development
$
566

 
$
479

 
$
1,730

 
$
1,413

Selling, general and administrative
$
411

 
$
387

 
$
1,274

 
$
1,184







Apple Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(In millions, except number of shares which are reflected in thousands and par value)
 
 
July 1,
2017
 
September 24,
2016
ASSETS:
Current assets:
 
 
 
Cash and cash equivalents
$
18,571

 
$
20,484

Short-term marketable securities
58,188

 
46,671

Accounts receivable, less allowances of $55 and $53, respectively
12,399

 
15,754

Inventories
3,146

 
2,132

Vendor non-trade receivables
10,233

 
13,545

Other current assets
10,338

 
8,283

Total current assets
112,875

 
106,869

 
 
 
 
Long-term marketable securities
184,757

 
170,430

Property, plant and equipment, net
29,286

 
27,010

Goodwill
5,661

 
5,414

Acquired intangible assets, net
2,444

 
3,206

Other non-current assets
10,150

 
8,757

Total assets
$
345,173

 
$
321,686

 
 
 
 
LIABILITIES AND SHAREHOLDERS’ EQUITY:
Current liabilities:
 
 
 
Accounts payable
$
31,915

 
$
37,294

Accrued expenses
23,304

 
22,027

Deferred revenue
7,608

 
8,080

Commercial paper
11,980

 
8,105

Current portion of long-term debt
6,495

 
3,500

Total current liabilities
81,302

 
79,006

 
 
 
 
Deferred revenue, non-current
2,984

 
2,930

Long-term debt
89,864

 
75,427

Other non-current liabilities
38,598

 
36,074

Total liabilities
212,748

 
193,437

 
 
 
 
Commitments and contingencies
 
 
 
 
 
 
 
Shareholders’ equity:
 
 
 
Common stock and additional paid-in capital, $0.00001 par value: 12,600,000 shares authorized; 5,169,782 and 5,336,166 shares issued and outstanding, respectively
34,445

 
31,251

Retained earnings
98,525

 
96,364

Accumulated other comprehensive income/(loss)
(545
)
 
634

Total shareholders’ equity
132,425

 
128,249

Total liabilities and shareholders’ equity
$
345,173

 
$
321,686







Apple Inc.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In millions)
 
Nine Months Ended
 
July 1,
2017
 
June 25,
2016
Cash and cash equivalents, beginning of the period
$
20,484

 
$
21,120

Operating activities:
 
 
 
Net income
37,637

 
36,673

Adjustments to reconcile net income to cash generated by operating activities:
 
 
 
Depreciation and amortization
7,673

 
7,957

Share-based compensation expense
3,666

 
3,180

Deferred income tax expense
4,764

 
5,191

Other
(142
)
 
419

Changes in operating assets and liabilities:
 
 
 
Accounts receivable, net
3,381

 
4,623

Inventories
(1,014
)
 
518

Vendor non-trade receivables
3,312

 
6,166

Other current and non-current assets
(3,229
)
 
1,049

Accounts payable
(5,212
)
 
(9,567
)
Deferred revenue
(418
)
 
(1,148
)
Other current and non-current liabilities
(2,476
)
 
(5,363
)
Cash generated by operating activities
47,942

 
49,698

Investing activities:
 
 
 
Purchases of marketable securities
(123,781
)
 
(112,068
)
Proceeds from maturities of marketable securities
19,347

 
14,915

Proceeds from sales of marketable securities
76,747

 
69,926

Payments made in connection with business acquisitions, net
(248
)
 
(146
)
Payments for acquisition of property, plant and equipment
(8,586
)
 
(8,757
)
Payments for acquisition of intangible assets
(209
)
 
(753
)
Payments for strategic investments, net
(87
)
 
(1,376
)
Other
313

 
(321
)
Cash used in investing activities
(36,504
)
 
(38,580
)
Financing activities:
 
 
 
Proceeds from issuance of common stock
274

 
247

Excess tax benefits from equity awards
534

 
391

Payments for taxes related to net share settlement of equity awards
(1,646
)
 
(1,361
)
Payments for dividends and dividend equivalents
(9,499
)
 
(9,058
)
Repurchases of common stock
(25,105
)
 
(23,696
)
Proceeds from issuance of term debt, net
21,725

 
17,984

Repayments of term debt
(3,500
)
 
(2,500
)
Change in commercial paper, net
3,866

 
3,992

Cash used in financing activities
(13,351
)
 
(14,001
)
Increase/(Decrease) in cash and cash equivalents
(1,913
)
 
(2,883
)
Cash and cash equivalents, end of the period
$
18,571

 
$
18,237

Supplemental cash flow disclosure:
 
 
 
Cash paid for income taxes, net
$
9,752

 
$
8,990

Cash paid for interest
$
1,456

 
$
892



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