falsedesktopAAPL2017-07-01000032019317000009{"tbl_sim": "https://q10k.com/tbl-sim", "search": "https://q10k.com/search"}{"q10k_tbl_0": "Large accelerated filer\t☒\tAccelerated filer\t☐\nNon-accelerated filer\t☐ (Do not check if a smaller reporting company)\tSmaller reporting company\t☐\n\t\tEmerging growth company\t☐\n", "q10k_tbl_1": "\t\tPage\nPart I\t\t\nItem 1.\tFinancial Statements\t1\nItem 2.\tManagement's Discussion and Analysis of Financial Condition and Results of Operations\t21\nItem 3.\tQuantitative and Qualitative Disclosures About Market Risk\t33\nItem 4.\tControls and Procedures\t33\nPart II\t\t\nItem 1.\tLegal Proceedings\t34\nItem 1A.\tRisk Factors\t34\nItem 2.\tUnregistered Sales of Equity Securities and Use of Proceeds\t44\nItem 3.\tDefaults Upon Senior Securities\t44\nItem 4.\tMine Safety Disclosures\t44\nItem 5.\tOther Information\t44\nItem 6.\tExhibits\t45\n", "q10k_tbl_2": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nNet sales\t45408\t42358\t176655\t168787\nCost of sales\t27920\t26252\t108400\t102337\nGross margin\t17488\t16106\t68255\t66450\nOperating expenses:\t\t\t\t\nResearch and development\t2937\t2560\t8584\t7475\nSelling general and administrative\t3783\t3441\t11447\t10712\nTotal operating expenses\t6720\t6001\t20031\t18187\nOperating income\t10768\t10105\t48224\t48263\nOther income/(expense) net\t540\t364\t1948\t921\nIncome before provision for income taxes\t11308\t10469\t50172\t49184\nProvision for income taxes\t2591\t2673\t12535\t12511\nNet income\t8717\t7796\t37637\t36673\nEarnings per share:\t\t\t\t\nBasic\t1.68\t1.43\t7.18\t6.66\nDiluted\t1.67\t1.42\t7.14\t6.62\nShares used in computing earnings per share:\t\t\t\t\nBasic\t5195088\t5443058\t5239847\t5505456\nDiluted\t5233499\t5472781\t5274394\t5535931\nCash dividends declared per share\t0.63\t0.57\t1.77\t1.61\n", "q10k_tbl_3": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nNet income\t8717\t7796\t37637\t36673\nOther comprehensive income/(loss):\t\t\t\t\nChange in foreign currency translation net of tax effects of $(35) $2 $(3) and $2 respectively\t120\t46\t(41)\t64\nChange in unrealized gains/losses on derivative instruments:\t\t\t\t\nChange in fair value of derivatives net of tax benefit/(expense) of $(16) $27 $(269) and $(10) respectively\t(166)\t(175)\t1002\t(66)\nAdjustment for net (gains)/losses realized and included in net income net of tax expense/(benefit) of $176 $46 $276 and $256 respectively\t(409)\t(88)\t(1135)\t(1061)\nTotal change in unrealized gains/losses on derivative instruments net of tax\t(575)\t(263)\t(133)\t(1127)\nChange in unrealized gains/losses on marketable securities:\t\t\t\t\nChange in fair value of marketable securities net of tax benefit/(expense) of $(197) $(641) $536 and $(663) respectively\t364\t1170\t(980)\t1217\nAdjustment for net (gains)/losses realized and included in net income net of tax expense/(benefit) of $16 $8 $12 and $(45) respectively\t(32)\t(12)\t(25)\t84\nTotal change in unrealized gains/losses on marketable securities net of tax\t332\t1158\t(1005)\t1301\nTotal other comprehensive income/(loss)\t(123)\t941\t(1179)\t238\nTotal comprehensive income\t8594\t8737\t36458\t36911\n", "q10k_tbl_4": "\tJuly 1 2017\tSeptember 24 2016\nASSETS:\t\t\nCurrent assets:\t\t\nCash and cash equivalents\t18571\t20484\nShort-term marketable securities\t58188\t46671\nAccounts receivable less allowances of $55 and $53 respectively\t12399\t15754\nInventories\t3146\t2132\nVendor non-trade receivables\t10233\t13545\nOther current assets\t10338\t8283\nTotal current assets\t112875\t106869\nLong-term marketable securities\t184757\t170430\nProperty plant and equipment net\t29286\t27010\nGoodwill\t5661\t5414\nAcquired intangible assets net\t2444\t3206\nOther non-current assets\t10150\t8757\nTotal assets\t345173\t321686\nLIABILITIES AND SHAREHOLDERS' EQUITY:\t\t\nCurrent liabilities:\t\t\nAccounts payable\t31915\t37294\nAccrued expenses\t23304\t22027\nDeferred revenue\t7608\t8080\nCommercial paper\t11980\t8105\nCurrent portion of long-term debt\t6495\t3500\nTotal current liabilities\t81302\t79006\nDeferred revenue non-current\t2984\t2930\nLong-term debt\t89864\t75427\nOther non-current liabilities\t38598\t36074\nTotal liabilities\t212748\t193437\nCommitments and contingencies\t\t\nShareholders' equity:\t\t\nCommon stock and additional paid-in capital $0.00001 par value: 12600000 shares authorized; 5169782 and 5336166 shares issued and outstanding respectively\t34445\t31251\nRetained earnings\t98525\t96364\nAccumulated other comprehensive income/(loss)\t(545)\t634\nTotal shareholders' equity\t132425\t128249\nTotal liabilities and shareholders' equity\t345173\t321686\n", "q10k_tbl_5": "\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\nCash and cash equivalents beginning of the period\t20484\t21120\nOperating activities:\t\t\nNet income\t37637\t36673\nAdjustments to reconcile net income to cash generated by operating activities:\t\t\nDepreciation and amortization\t7673\t7957\nShare-based compensation expense\t3666\t3180\nDeferred income tax expense\t4764\t5191\nOther\t(142)\t419\nChanges in operating assets and liabilities:\t\t\nAccounts receivable net\t3381\t4623\nInventories\t(1014)\t518\nVendor non-trade receivables\t3312\t6166\nOther current and non-current assets\t(3229)\t1049\nAccounts payable\t(5212)\t(9567)\nDeferred revenue\t(418)\t(1148)\nOther current and non-current liabilities\t(2476)\t(5363)\nCash generated by operating activities\t47942\t49698\nInvesting activities:\t\t\nPurchases of marketable securities\t(123781)\t(112068)\nProceeds from maturities of marketable securities\t19347\t14915\nProceeds from sales of marketable securities\t76747\t69926\nPayments made in connection with business acquisitions net\t(248)\t(146)\nPayments for acquisition of property plant and equipment\t(8586)\t(8757)\nPayments for acquisition of intangible assets\t(209)\t(753)\nPayments for strategic investments net\t(87)\t(1376)\nOther\t313\t(321)\nCash used in investing activities\t(36504)\t(38580)\nFinancing activities:\t\t\nProceeds from issuance of common stock\t274\t247\nExcess tax benefits from equity awards\t534\t391\nPayments for taxes related to net share settlement of equity awards\t(1646)\t(1361)\nPayments for dividends and dividend equivalents\t(9499)\t(9058)\nRepurchases of common stock\t(25105)\t(23696)\nProceeds from issuance of term debt net\t21725\t17984\nRepayments of term debt\t(3500)\t(2500)\nChange in commercial paper net\t3866\t3992\nCash used in financing activities\t(13351)\t(14001)\nIncrease/(Decrease) in cash and cash equivalents\t(1913)\t(2883)\nCash and cash equivalents end of the period\t18571\t18237\nSupplemental cash flow disclosure:\t\t\nCash paid for income taxes net\t9752\t8990\nCash paid for interest\t1456\t892\n", "q10k_tbl_6": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nNumerator:\t\t\t\t\nNet income\t8717\t7796\t37637\t36673\nDenominator:\t\t\t\t\nWeighted-average shares outstanding\t5195088\t5443058\t5239847\t5505456\nEffect of dilutive securities\t38411\t29723\t34547\t30475\nWeighted-average diluted shares\t5233499\t5472781\t5274394\t5535931\nBasic earnings per share\t1.68\t1.43\t7.18\t6.66\nDiluted earnings per share\t1.67\t1.42\t7.14\t6.62\n", "q10k_tbl_7": "\tJuly 1 2017\t\t\t\t\t\t\n\tAdjusted Cost\tUnrealized Gains\tUnrealized Losses\tFair Value\tCash and Cash Equivalents\tShort-Term Marketable Securities\tLong-Term Marketable Securities\nCash\t8529\t0\t0\t8529\t8529\t0\t0\nLevel 1 (1):\t\t\t\t\t\t\t\nMoney market funds\t3088\t0\t0\t3088\t3088\t0\t0\nMutual funds\t1004\t0\t(118)\t886\t0\t886\t0\nSubtotal\t4092\t0\t(118)\t3974\t3088\t886\t0\nLevel 2 (2):\t\t\t\t\t\t\t\nU.S. Treasury securities\t52616\t77\t(230)\t52463\t1013\t20104\t31346\nU.S. agency securities\t5328\t3\t(9)\t5322\t2255\t1774\t1293\nNon-U.S. government securities\t6987\t156\t(50)\t7093\t0\t64\t7029\nCertificates of deposit and time deposits\t6731\t0\t0\t6731\t894\t5191\t646\nCommercial paper\t5187\t0\t0\t5187\t2683\t2504\t0\nCorporate securities\t150089\t882\t(312)\t150659\t109\t27522\t123028\nMunicipal securities\t938\t3\t(2)\t939\t0\t127\t812\nMortgage- and asset-backed securities\t20762\t34\t(177)\t20619\t0\t16\t20603\nSubtotal\t248638\t1155\t(780)\t249013\t6954\t57302\t184757\nTotal\t261259\t1155\t(898)\t261516\t18571\t58188\t184757\n", "q10k_tbl_8": "\tSeptember 24 2016\t\t\t\t\t\t\n\tAdjusted Cost\tUnrealized Gains\tUnrealized Losses\tFair Value\tCash and Cash Equivalents\tShort-Term Marketable Securities\tLong-Term Marketable Securities\nCash\t8601\t0\t0\t8601\t8601\t0\t0\nLevel 1 (1):\t\t\t\t\t\t\t\nMoney market funds\t3666\t0\t0\t3666\t3666\t0\t0\nMutual funds\t1407\t0\t(146)\t1261\t0\t1261\t0\nSubtotal\t5073\t0\t(146)\t4927\t3666\t1261\t0\nLevel 2 (2):\t\t\t\t\t\t\t\nU.S. Treasury securities\t41697\t319\t(4)\t42012\t1527\t13492\t26993\nU.S. agency securities\t7543\t16\t0\t7559\t2762\t2441\t2356\nNon-U.S. government securities\t7609\t259\t(27)\t7841\t110\t818\t6913\nCertificates of deposit and time deposits\t6598\t0\t0\t6598\t1108\t3897\t1593\nCommercial paper\t7433\t0\t0\t7433\t2468\t4965\t0\nCorporate securities\t131166\t1409\t(206)\t132369\t242\t19599\t112528\nMunicipal securities\t956\t5\t0\t961\t0\t167\t794\nMortgage- and asset-backed securities\t19134\t178\t(28)\t19284\t0\t31\t19253\nSubtotal\t222136\t2186\t(265)\t224057\t8217\t45410\t170430\nTotal\t235810\t2186\t(411)\t237585\t20484\t46671\t170430\n", "q10k_tbl_9": "\tJuly 1 2017\t\t\n\tFair Value of Derivatives Designated as Hedge Instruments\tFair Value of Derivatives Not Designated as Hedge Instruments\tTotal Fair Value\nDerivative assets (1):\t\t\t\nForeign exchange contracts\t485\t242\t727\nInterest rate contracts\t253\t0\t253\nDerivative liabilities (2):\t\t\t\nForeign exchange contracts\t842\t362\t1204\nInterest rate contracts\t264\t0\t264\n", "q10k_tbl_10": "\tSeptember 24 2016\t\t\n\tFair Value of Derivatives Designated as Hedge Instruments\tFair Value of Derivatives Not Designated as Hedge Instruments\tTotal Fair Value\nDerivative assets (1):\t\t\t\nForeign exchange contracts\t518\t153\t671\nInterest rate contracts\t728\t0\t728\nDerivative liabilities (2):\t\t\t\nForeign exchange contracts\t935\t134\t1069\nInterest rate contracts\t7\t0\t7\n", "q10k_tbl_11": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nGains/(Losses) recognized in OCI - effective portion:\t\t\t\t\nCash flow hedges:\t\t\t\t\nForeign exchange contracts\t(143)\t(170)\t1267\t18\nInterest rate contracts\t(2)\t(11)\t7\t(53)\nTotal\t(145)\t(181)\t1274\t(35)\nNet investment hedges:\t\t\t\t\nForeign currency debt\t16\t(128)\t53\t(205)\nGains/(Losses) reclassified from AOCI into net income - effective portion:\t\t\t\t\nCash flow hedges:\t\t\t\t\nForeign exchange contracts\t585\t142\t1418\t1325\nInterest rate contracts\t0\t(3)\t(3)\t(10)\nTotal\t585\t139\t1415\t1315\nGains/(Losses) on derivative instruments:\t\t\t\t\nFair value hedges:\t\t\t\t\nInterest rate contracts\t185\t345\t(737)\t484\nGains/(Losses) related to hedged items:\t\t\t\t\nFair value hedges:\t\t\t\t\nFixed-rate debt\t(185)\t(345)\t737\t(484)\n", "q10k_tbl_12": "\tJuly 1 2017\t\tSeptember 24 2016\t\n\tNotional Amount\tCredit Risk Amount\tNotional Amount\tCredit Risk Amount\nInstruments designated as accounting hedges:\t\t\t\t\nForeign exchange contracts\t43700\t485\t44678\t518\nInterest rate contracts\t31500\t253\t24500\t728\nInstruments not designated as accounting hedges:\t\t\t\t\nForeign exchange contracts\t48774\t242\t54305\t153\n", "q10k_tbl_13": "\tJuly 1 2017\tSeptember 24 2016\nLand and buildings\t12529\t10185\nMachinery equipment and internal-use software\t49491\t44543\nLeasehold improvements\t6961\t6517\nGross property plant and equipment\t68981\t61245\nAccumulated depreciation and amortization\t(39695)\t(34235)\nTotal property plant and equipment net\t29286\t27010\n", "q10k_tbl_14": "\tJuly 1 2017\tSeptember 24 2016\nDeferred tax liabilities\t30191\t26019\nOther non-current liabilities\t8407\t10055\nTotal other non-current liabilities\t38598\t36074\n", "q10k_tbl_15": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nInterest and dividend income\t1327\t1036\t3833\t2963\nInterest expense\t(602)\t(409)\t(1657)\t(1006)\nOther expense net\t(185)\t(263)\t(228)\t(1036)\nTotal other income/(expense) net\t540\t364\t1948\t921\n", "q10k_tbl_16": "\tJuly 1 2017\t\t\tSeptember 24 2016\t\t\n\tGross Carrying Amount\tAccumulated Amortization\tNet Carrying Amount\tGross Carrying Amount\tAccumulated Amortization\tNet Carrying Amount\nDefinite-lived and amortizable acquired intangible assets\t7358\t(5014)\t2344\t8912\t(5806)\t3106\nIndefinite-lived and non-amortizable acquired intangible assets\t100\t0\t100\t100\t0\t100\nTotal acquired intangible assets\t7458\t(5014)\t2444\t9012\t(5806)\t3206\n", "q10k_tbl_17": "\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\nMaturities less than 90 days:\t\t\nProceeds from/(Repayments of) commercial paper net\t(143)\t4154\nMaturities greater than 90 days:\t\t\nProceeds from commercial paper\t12633\t1846\nRepayments of commercial paper\t(8624)\t(2008)\nProceeds from/(Repayments of) commercial paper net\t4009\t(162)\nTotal change in commercial paper net\t3866\t3992\n", "q10k_tbl_18": "\tMaturities\t\tJuly 1 2017\t\t\tSeptember 24 2016\t\t\n\tAmount (in millions)\t\tEffective Interest Rate\tAmount (in millions)\t\tEffective Interest Rate\n2013 debt issuance of $17.0 billion:\t\t\t\t\t\t\t\t\nFloating-rate notes\t2018\t2018\t2000\t1.10%\t1.10%\t2000\t1.10%\t1.10%\nFixed-rate 1.000% - 3.850% notes\t2018-2043\t\t12500\t1.08%-3.91\t%\t12500\t1.08%-3.91\t%\n2014 debt issuance of $12.0 billion:\t\t\t\t\t\t\t\t\nFloating-rate notes\t2019-2019\t\t1000\t1.48%\t1.48%\t2000\t0.86%-1.09\t%\nFixed-rate 2.100% - 4.450% notes\t2019-2044\t\t8500\t1.48%-4.48\t%\t10000\t0.85%-4.48\t%\n2015 debt issuances of $27.3 billion:\t\t\t\t\t\t\t\t\nFloating-rate notes\t2019-2020\t\t1532\t1.43%-1.87\t%\t1781\t0.87%-1.87\t%\nFixed-rate 0.350% - 4.375% notes\t2019-2045\t\t24259\t0.28%-4.51\t%\t25144\t0.28%-4.51\t%\n2016 debt issuances of $24.9 billion:\t\t\t\t\t\t\t\t\nFloating-rate notes\t2019-2021\t\t1350\t1.31%-2.32\t%\t1350\t0.91%-1.95\t%\nFixed-rate 1.100% - 4.650% notes\t2018-2046\t\t23610\t1.13%-4.78\t%\t23609\t1.13%-4.58\t%\nSecond quarter 2017 debt issuance of $10.0 billion:\t\t\t\t\t\t\t\t\nFloating-rate notes\t\t2019\t500\t\t1.26%\t0\t\t-%\nFloating-rate notes\t\t2020\t500\t\t1.38%\t0\t\t-%\nFloating-rate notes\t\t2022\t1000\t\t1.68%\t0\t\t-%\nFixed-rate 1.550% notes\t\t2019\t500\t\t1.59%\t0\t\t-%\nFixed-rate 1.900% notes\t\t2020\t1000\t\t1.38%\t0\t\t-%\nFixed-rate 2.500% notes\t\t2022\t1500\t\t1.67%\t0\t\t-%\nFixed-rate 3.000% notes\t\t2024\t1750\t\t1.98%\t0\t\t-%\nFixed-rate 3.350% notes\t\t2027\t2250\t\t2.12%\t0\t\t-%\nFixed-rate 4.250% notes\t\t2047\t1000\t\t4.26%\t0\t\t-%\nSecond quarter 2017 debt issuance of $1.0 billion:\t\t\t\t\t\t\t\t\nFixed-rate 4.300% notes\t\t2047\t1000\t\t4.30%\t0\t\t-%\nThird quarter 2017 debt issuance of $7.0 billion:\t\t\t\t\t\t\t\t\nFloating-rate notes\t\t2020\t500\t\t1.25%\t0\t\t-%\nFloating-rate notes\t\t2022\t750\t\t1.53%\t0\t\t-%\nFixed-rate 1.800% notes\t\t2020\t1000\t\t1.84%\t0\t\t-%\nFixed-rate 2.300% notes\t\t2022\t1000\t\t2.34%\t0\t\t-%\nFixed-rate 2.850% notes\t\t2024\t1750\t\t2.16%\t0\t\t-%\nFixed-rate 3.200% notes\t\t2027\t2000\t\t2.34%\t0\t\t-%\nThird quarter 2017 euro-denominated debt issuance of €2.5 billion:\t\t\t\t\t\t\t\t\nFixed-rate 0.875% notes\t\t2025\t1419\t\t3.03%\t0\t\t-%\nFixed-rate 1.375% notes\t\t2029\t1419\t\t3.37%\t0\t\t-%\nThird quarter 2017 debt issuance of $1.0 billion:\t\t\t\t\t\t\t\t\nFixed-rate 3.000% notes\t\t2027\t1000\t\t3.03%\t0\t\t-%\nTotal term debt\t\t\t96589\t\t\t78384\t\t\nUnamortized premium/(discount) and issuance costs net\t\t\t(210)\t\t\t(174)\t\t\nHedge accounting fair value adjustments\t\t\t(20)\t\t\t717\t\t\nLess: Current portion of long-term debt\t\t\t(6495)\t\t\t(3500)\t\t\nTotal long-term debt\t\t\t89864\t\t\t75427\t\t\n", "q10k_tbl_19": "\tDividends Per Share\tAmount (in millions)\n2017:\t\t\nThird quarter\t0.63\t3281\nSecond quarter\t0.57\t2988\nFirst quarter\t0.57\t3042\nTotal cash dividends declared and paid\t1.77\t9311\n2016:\t\t\nFourth quarter\t0.57\t3071\nThird quarter\t0.57\t3117\nSecond quarter\t0.52\t2879\nFirst quarter\t0.52\t2898\nTotal cash dividends declared and paid\t2.18\t11965\n", "q10k_tbl_20": "\tPurchase Period End Date\tNumber of Shares (in thousands)\t\tAverage Repurchase Price Per Share\tASR Amount (in millions)\nMay 2017 ASR\tAugust 2017\t15598\t(1)\t(1)\t3000\nFebruary 2017 ASR\tMay 2017\t20949\t(2)\t143.20\t3000\nNovember 2016 ASR\tFebruary 2017\t51157\t\t117.29\t6000\nAugust 2016 ASR\tNovember 2016\t26850\t\t111.73\t3000\nMay 2016 ASR\tAugust 2016\t60452\t\t99.25\t6000\nNovember 2015 ASR\tApril 2016\t29122\t\t103.02\t3000\n", "q10k_tbl_21": "\tNumber of Shares (in thousands)\tAverage Repurchase Price Per Share\tAmount (in millions)\n2017:\t\t\t\nThird quarter\t30356\t148.24\t4500\nSecond quarter\t31070\t128.74\t4001\nFirst quarter\t44333\t112.78\t5000\nTotal open market common stock repurchases\t105759\t\t13501\n2016:\t\t\t\nFourth quarter\t28579\t104.97\t3000\nThird quarter\t41238\t97.00\t4000\nSecond quarter\t71766\t97.54\t7000\nFirst quarter\t25984\t115.45\t3000\nTotal open market common stock repurchases\t167567\t\t17000\n", "q10k_tbl_22": "\t\tThree Months Ended\t\tNine Months Ended\t\nComprehensive Income Components\tFinancial Statement Line Item\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nUnrealized (gains)/losses on derivative instruments:\t\t\t\t\t\nForeign exchange contracts\tRevenue\t(148)\t(131)\t(657)\t(785)\n\tCost of sales\t(73)\t106\t(630)\t(419)\n\tOther income/(expense) net\t(364)\t(112)\t(127)\t(123)\nInterest rate contracts\tOther income/(expense) net\t0\t3\t3\t10\n\t\t(585)\t(134)\t(1411)\t(1317)\nUnrealized (gains)/losses on marketable securities\tOther income/(expense) net\t(48)\t(20)\t(37)\t129\nTotal amounts reclassified from AOCI\t\t(633)\t(154)\t(1448)\t(1188)\n", "q10k_tbl_23": "\tCumulative Foreign Currency Translation\tUnrealized Gains/Losses on Derivative Instruments\tUnrealized Gains/Losses on Marketable Securities\tTotal\nBalance at September 24 2016\t(578)\t38\t1174\t634\nOther comprehensive income/(loss) before reclassifications\t(38)\t1271\t(1516)\t(283)\nAmounts reclassified from AOCI\t0\t(1411)\t(37)\t(1448)\nTax effect\t(3)\t7\t548\t552\nOther comprehensive income/(loss)\t(41)\t(133)\t(1005)\t(1179)\nBalance at July 1 2017\t(619)\t(95)\t169\t(545)\n", "q10k_tbl_24": "\tNumber of RSUs (in thousands)\tWeighted-Average Grant Date Fair Value Per Share\tAggregate Fair Value (in millions)\nBalance at September 24 2016\t99089\t97.54\t\nRSUs granted\t48000\t120.09\t\nRSUs vested)\t(41712\t95.78\t\nRSUs canceled)\t(4779\t106.75\t\nBalance at July 1 2017\t100598\t108.59\t14488\n", "q10k_tbl_25": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nCost of sales\t216\t188\t662\t583\nResearch and development\t566\t479\t1730\t1413\nSelling general and administrative\t411\t387\t1274\t1184\nTotal share-based compensation expense\t1193\t1054\t3666\t3180\n", "q10k_tbl_26": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nBeginning accrued warranty and related costs\t4735\t4985\t3702\t4780\nCost of warranty claims\t(932)\t(1110)\t(3300)\t(3507)\nAccruals for product warranty\t496\t380\t3897\t2982\nEnding accrued warranty and related costs\t4299\t4255\t4299\t4255\n", "q10k_tbl_27": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nAmericas:\t\t\t\t\nNet sales\t20376\t17963\t73501\t66384\nOperating income\t6420\t5453\t23582\t21587\nEurope:\t\t\t\t\nNet sales\t10675\t9643\t41929\t39110\nOperating income\t2984\t2666\t12571\t12047\nGreater China:\t\t\t\t\nNet sales\t8004\t8848\t34963\t39707\nOperating income\t3002\t3415\t13402\t15809\nJapan:\t\t\t\t\nNet sales\t3624\t3529\t13875\t12604\nOperating income\t1624\t1435\t6334\t5605\nRest of Asia Pacific:\t\t\t\t\nNet sales\t2729\t2375\t12387\t10982\nOperating income\t892\t753\t4430\t3880\n", "q10k_tbl_28": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nSegment operating income\t14922\t13722\t60319\t58928\nResearch and development expense\t(2937)\t(2560)\t(8584)\t(7475)\nOther corporate expenses net\t(1217)\t(1057)\t(3511)\t(3190)\nTotal operating income\t10768\t10105\t48224\t48263\n", "q10k_tbl_29": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tJuly 1 2017\tJune 25 2016\tChange\tJuly 1 2017\tJune 25 2016\tChange\nNet Sales by Operating Segment:\t\t\t\t\t\t\nAmericas\t20376\t17963\t13%\t73501\t66384\t11%\nEurope\t10675\t9643\t11%\t41929\t39110\t7%\nGreater China\t8004\t8848\t(10)%\t34963\t39707\t(12)%\nJapan\t3624\t3529\t3%\t13875\t12604\t10%\nRest of Asia Pacific\t2729\t2375\t15%\t12387\t10982\t13%\nTotal net sales\t45408\t42358\t7%\t176655\t168787\t5%\nNet Sales by Product:\t\t\t\t\t\t\niPhone (1)\t24846\t24048\t3%\t112473\t108540\t4%\niPad (1)\t4969\t4876\t2%\t14391\t16373\t(12)%\nMac (1)\t5592\t5239\t7%\t18680\t17092\t9%\nServices (2)\t7266\t5976\t22%\t21479\t18023\t19%\nOther Products (1)(3)\t2735\t2219\t23%\t9632\t8759\t10%\nTotal net sales\t45408\t42358\t7%\t176655\t168787\t5%\nUnit Sales by Product:\t\t\t\t\t\t\niPhone\t41026\t40399\t2%\t170079\t166371\t2%\niPad\t11424\t9950\t15%\t33427\t36323\t(8)%\nMac\t4292\t4252\t1%\t13865\t13598\t2%\n", "q10k_tbl_30": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tJuly 1 2017\tJune 25 2016\tChange\tJuly 1 2017\tJune 25 2016\tChange\nNet sales\t24846\t24048\t3%\t112473\t108540\t4%\nPercentage of total net sales\t55%\t57%\t\t64%\t64%\t\nUnit sales\t41026\t40399\t2%\t170079\t166371\t2%\n", "q10k_tbl_31": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tJuly 1 2017\tJune 25 2016\tChange\tJuly 1 2017\tJune 25 2016\tChange\nNet sales\t4969\t4876\t2%\t14391\t16373\t(12)%\nPercentage of total net sales\t11%\t12%\t\t8%\t10%\t\nUnit sales\t11424\t9950\t15%\t33427\t36323\t(8)%\n", "q10k_tbl_32": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tJuly 1 2017\tJune 25 2016\tChange\tJuly 1 2017\tJune 25 2016\tChange\nNet sales\t5592\t5239\t7%\t18680\t17092\t9%\nPercentage of total net sales\t12%\t12%\t\t11%\t10%\t\nUnit sales\t4292\t4252\t1%\t13865\t13598\t2%\n", "q10k_tbl_33": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tJuly 1 2017\tJune 25 2016\tChange\tJuly 1 2017\tJune 25 2016\tChange\nNet sales\t7266\t5976\t22%\t21479\t18023\t19%\nPercentage of total net sales\t16%\t14%\t\t12%\t11%\t\n", "q10k_tbl_34": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tJuly 1 2017\tJune 25 2016\tChange\tJuly 1 2017\tJune 25 2016\tChange\nNet sales\t20376\t17963\t13%\t73501\t66384\t11%\nPercentage of total net sales\t45%\t42%\t\t42%\t39%\t\n", "q10k_tbl_35": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tJuly 1 2017\tJune 25 2016\tChange\tJuly 1 2017\tJune 25 2016\tChange\nNet sales\t10675\t9643\t11%\t41929\t39110\t7%\nPercentage of total net sales\t24%\t23%\t\t24%\t23%\t\n", "q10k_tbl_36": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tJuly 1 2017\tJune 25 2016\tChange\tJuly 1 2017\tJune 25 2016\tChange\nNet sales\t8004\t8848\t(10)%\t34963\t39707\t(12)%\nPercentage of total net sales\t18%\t21%\t\t20%\t24%\t\n", "q10k_tbl_37": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tJuly 1 2017\tJune 25 2016\tChange\tJuly 1 2017\tJune 25 2016\tChange\nNet sales\t3624\t3529\t3%\t13875\t12604\t10%\nPercentage of total net sales\t8%\t8%\t\t8%\t7%\t\n", "q10k_tbl_38": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tJuly 1 2017\tJune 25 2016\tChange\tJuly 1 2017\tJune 25 2016\tChange\nNet sales\t2729\t2375\t15%\t12387\t10982\t13%\nPercentage of total net sales\t6%\t6%\t\t7%\t7%\t\n", "q10k_tbl_39": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nNet sales\t45408\t42358\t176655\t168787\nCost of sales\t27920\t26252\t108400\t102337\nGross margin\t17488\t16106\t68255\t66450\nGross margin percentage\t38.5%\t38.0%\t38.6%\t39.4%\n", "q10k_tbl_40": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nResearch and development\t2937\t2560\t8584\t7475\nPercentage of total net sales\t6%\t6%\t5%\t4%\nSelling general and administrative\t3783\t3441\t11447\t10712\nPercentage of total net sales\t8%\t8%\t6%\t6%\nTotal operating expenses\t6720\t6001\t20031\t18187\nPercentage of total net sales\t15%\t14%\t11%\t11%\n", "q10k_tbl_41": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tJuly 1 2017\tJune 25 2016\tChange\tJuly 1 2017\tJune 25 2016\tChange\nInterest and dividend income\t1327\t1036\t\t3833\t2963\t\nInterest expense\t(602)\t(409)\t\t(1657)\t(1006)\t\nOther expense net\t(185)\t(263)\t\t(228)\t(1036)\t\nTotal other income/(expense) net\t540\t364\t48%\t1948\t921\t112%\n", "q10k_tbl_42": "\tThree Months Ended\t\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\tJuly 1 2017\tJune 25 2016\nProvision for income taxes\t2591\t2673\t12535\t12511\nEffective tax rate\t22.9%\t25.5%\t25.0%\t25.4%\n", "q10k_tbl_43": "\tJuly 1 2017\tSeptember 24 2016\nCash cash equivalents and marketable securities\t261516\t237585\nProperty plant and equipment net\t29286\t27010\nCommercial paper\t11980\t8105\nTotal term debt\t96359\t78927\nWorking capital\t31573\t27863\n", "q10k_tbl_44": "\tNine Months Ended\t\n\tJuly 1 2017\tJune 25 2016\nCash generated by operating activities\t47942\t49698\nCash used in investing activities\t(36504)\t(38580)\nCash used in financing activities\t(13351)\t(14001)\n", "q10k_tbl_45": "\tDividends and Dividend Equivalents Paid\tAccelerated Share Repurchases\tOpen Market Share Repurchases\tTaxes Related to Settlement of Equity Awards\tTotal\nQ3 2017\t3365\t3000\t4500\t858\t11723\nQ2 2017\t3004\t3000\t4001\t159\t10164\nQ1 2017\t3130\t6000\t5000\t629\t14759\n2016\t12150\t12000\t17000\t1570\t42720\n2015\t11561\t6000\t30026\t1499\t49086\n2014\t11126\t21000\t24000\t1158\t57284\n2013\t10564\t13950\t9000\t1082\t34596\n2012\t2488\t0\t0\t56\t2544\nTotal\t57388\t64950\t93527\t7011\t222876\n", "q10k_tbl_46": "Periods\tTotal Number of Shares Purchased\tAverage Price Paid Per Share\tTotal Number of Shares Purchased as Part of Publicly Announced Plans or Programs\tApproximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (1)\nApril 2 2017 to May 6 2017:\t\t\t\t\nOpen market and privately negotiated purchases\t6968\t143.52\t6968\t\nMay 7 2017 to June 3 2017:\t\t\t\t\nFebruary 2017 ASR\t3422\t(2)\t3422\t\nMay 2017 ASR\t15598\t(3) (3)\t15598\t(3)\nOpen market and privately negotiated purchases\t10650\t153.65\t10650\t\nJune 4 2017 to July 1 2017:\t\t\t\t\nOpen market and privately negotiated purchases\t12738\t146.31\t12738\t\nTotal\t49376\t\t\t51523\n", "q10k_tbl_47": "\t\tIncorporated by Reference\t\t\nExhibit Number\tExhibit Description\tForm\tExhibit\tFiling Date/ Period End Date\n4.1\tOfficer's Certificate of the Registrant dated as of May 11 2017 including forms of global notes representing the Floating Rate Notes due 2020 Floating Rate Notes due 2022 1.800% Notes due 2020 2.300% Notes due 2022 2.850% Notes due 2024 and 3.200% Notes due 2027.\t8-K\t4.1\t5/11/17\n4.2\tOfficer's Certificate of the Registrant dated as of May 24 2017 including forms of global notes representing the 0.875% Notes due 2025 and 1.375% Notes due 2029.\t8-K\t4.1\t5/24/17\n4.3\tOfficer's Certificate of the Registrant dated as of June 20 2017 including form of global note representing the 3.000% Notes due 2027.\t8-K\t4.1\t6/20/17\n31.1*\tRule 13a-14(a) / 15d-14(a) Certification of Chief Executive Officer.\t\t\t\n31.2*\tRule 13a-14(a) / 15d-14(a) Certification of Chief Financial Officer.\t\t\t\n32.1**\tSection 1350 Certifications of Chief Executive Officer and Chief Financial Officer.\t\t\t\n101.INS*\tXBRL Instance Document.\t\t\t\n101.SCH*\tXBRL Taxonomy Extension Schema Document.\t\t\t\n101.CAL*\tXBRL Taxonomy Extension Calculation Linkbase Document.\t\t\t\n101.DEF*\tXBRL Taxonomy Extension Definition Linkbase Document.\t\t\t\n101.LAB*\tXBRL Taxonomy Extension Label Linkbase Document.\t\t\t\n101.PRE*\tXBRL Taxonomy Extension Presentation Linkbase Document.\t\t\t\n"}{"bs": "q10k_tbl_4", "is": "q10k_tbl_2", "cf": "q10k_tbl_5"}None
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
Exhibits
EX-31.1
a10-qexhibit311712017.htm
EX-31.2
a10-qexhibit312712017.htm
EX-32.2
a10-qexhibit321712017.htm
Apple Earnings 2017-07-01
Balance Sheet
Income Statement
Cash Flow
Assets, Equity
Rev, G Profit, Net Income
Ops, Inv, Fin
10-Q 1 a10-qq32017712017.htm 10-Q Document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended July 1, 2017
or
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to .
Commission File Number: 001-36743
Apple Inc.
(Exact name of Registrant as specified in its charter)
California
94-2404110
(State or other jurisdiction
of incorporation or organization)
(I.R.S. Employer Identification No.)
1 Infinite Loop
Cupertino, California
95014
(Address of principal executive offices)
(Zip Code)
(408) 996-1010
(Registrant’s telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes ☒ No ☐
Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files).
Yes ☒ No ☐
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☒
Accelerated filer
☐
Non-accelerated filer
☐ (Do not check if a smaller reporting company)
Smaller reporting company
☐
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No ☒
5,165,228,000 shares of common stock, par value $0.00001 per share, issued and outstanding as of July 21, 2017
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
27,920
26,252
108,400
102,337
Gross margin
17,488
16,106
68,255
66,450
Operating expenses:
Research and development
2,937
2,560
8,584
7,475
Selling, general and administrative
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
See accompanying Notes to Condensed Consolidated Financial Statements.
Apple Inc. | Q3 2017 Form 10-Q | 1
Apple Inc.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
(In millions)
Three Months Ended
Nine Months Ended
July 1, 2017
June 25, 2016
July 1, 2017
June 25, 2016
Net income
$
8,717
$
7,796
$
37,637
$
36,673
Other comprehensive income/(loss):
Change in foreign currency translation, net of tax effects of $(35), $2, $(3) and $2, respectively
120
46
(41
)
64
Change in unrealized gains/losses on derivative instruments:
Change in fair value of derivatives, net of tax benefit/(expense) of $(16), $27, $(269) and $(10), respectively
(166
)
(175
)
1,002
(66
)
Adjustment for net (gains)/losses realized and included in net income, net of tax expense/(benefit) of $176, $46, $276 and $256, respectively
(409
)
(88
)
(1,135
)
(1,061
)
Total change in unrealized gains/losses on derivative instruments, net of tax
(575
)
(263
)
(133
)
(1,127
)
Change in unrealized gains/losses on marketable securities:
Change in fair value of marketable securities, net of tax benefit/(expense) of $(197), $(641), $536 and $(663), respectively
364
1,170
(980
)
1,217
Adjustment for net (gains)/losses realized and included in net income, net of tax expense/(benefit) of $16, $8, $12 and $(45), respectively
(32
)
(12
)
(25
)
84
Total change in unrealized gains/losses on marketable securities, net of tax
332
1,158
(1,005
)
1,301
Total other comprehensive income/(loss)
(123
)
941
(1,179
)
238
Total comprehensive income
$
8,594
$
8,737
$
36,458
$
36,911
See accompanying Notes to Condensed Consolidated Financial Statements.
Apple Inc. | Q3 2017 Form 10-Q | 2
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
See accompanying Notes to Condensed Consolidated Financial Statements.
Apple Inc. | Q3 2017 Form 10-Q | 3
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
See accompanying Notes to Condensed Consolidated Financial Statements.
Apple Inc. | Q3 2017 Form 10-Q | 4
Apple Inc.
Notes to Condensed Consolidated Financial Statements (Unaudited)
Note 1 – Summary of Significant Accounting Policies
Apple Inc. and its wholly-owned subsidiaries (collectively “Apple” or the “Company”) designs, manufactures and markets mobile communication and media devices and personal computers, and sells a variety of related software, services, accessories, networking solutions and third-party digital content and applications. The Company’s products and services include iPhone®, iPad®, Mac®, Apple Watch®, Apple TV®, a portfolio of consumer and professional software applications, iOS, macOS®, watchOS® and tvOS™ operating systems, iCloud®, Apple Pay® and a variety of accessory, service and support offerings. The Company sells and delivers digital content and applications through the iTunes Store®, App Store®, Mac App Store, TV App Store, iBooks Store® and Apple Music® (collectively “Digital Content and Services”). The Company sells its products worldwide through its retail stores, online stores and direct sales force, as well as through third-party cellular network carriers, wholesalers, retailers and value-added resellers. In addition, the Company sells a variety of third-party Apple-compatible products, including application software and various accessories through its retail and online stores. The Company sells to consumers, small and mid-sized businesses and education, enterprise and government customers.
Basis of Presentation and Preparation
The accompanying condensed consolidated financial statements include the accounts of the Company. Intercompany accounts and transactions have been eliminated. In the opinion of the Company’s management, the condensed consolidated financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. The preparation of these condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in these condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. Certain prior period amounts in the condensed consolidated financial statements have been reclassified to conform to the current period’s presentation. These condensed consolidated financial statements and accompanying notes should be read in conjunction with the Company’s annual consolidated financial statements and the notes thereto included in its Annual Report on Form 10-K for the fiscal year ended September 24, 2016 (the “2016 Form 10-K”).
The Company’s fiscal year is the 52 or 53-week period that ends on the last Saturday of September. The Company’s fiscal year 2017 will include 53 weeks and ends on September 30, 2017 and its fiscal year 2016 included 52 weeks and ended on September 24, 2016. A 14th week was included in the first quarter of 2017, as is done every five or six years, to realign fiscal quarters with calendar quarters. Unless otherwise stated, references to particular years, quarters, months and periods refer to the Company’s fiscal years ended in September and the associated quarters, months and periods of those fiscal years.
Earnings Per Share
Basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing income available to common shareholders by the weighted-average number of shares of common stock outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if the potentially dilutive securities had been issued. Potentially dilutive securities include outstanding stock options, shares to be purchased by employees under the Company’s employee stock purchase plan, unvested restricted stock and unvested restricted stock units (“RSUs”). The dilutive effect of potentially dilutive securities is reflected in diluted earnings per share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of the Company’s common stock can result in a greater dilutive effect from potentially dilutive securities.
Apple Inc. | Q3 2017 Form 10-Q | 5
The following table shows the computation of basic and diluted earnings per share for the three- and nine-month periods ended July 1, 2017 and June 25, 2016 (net income in millions and shares in thousands):
Three Months Ended
Nine Months Ended
July 1, 2017
June 25, 2016
July 1, 2017
June 25, 2016
Numerator:
Net income
$
8,717
$
7,796
$
37,637
$
36,673
Denominator:
Weighted-average shares outstanding
5,195,088
5,443,058
5,239,847
5,505,456
Effect of dilutive securities
38,411
29,723
34,547
30,475
Weighted-average diluted shares
5,233,499
5,472,781
5,274,394
5,535,931
Basic earnings per share
$
1.68
$
1.43
$
7.18
$
6.66
Diluted earnings per share
$
1.67
$
1.42
$
7.14
$
6.62
Potentially dilutive securities whose effect would have been antidilutive are excluded from the computation of diluted earnings per share.
Note 2 – Financial Instruments
Cash, Cash Equivalents and Marketable Securities
The following tables show the Company’s cash and available-for-sale securities by significant investment category as of July 1, 2017 and September 24, 2016 (in millions):
July 1, 2017
Adjusted
Cost
Unrealized
Gains
Unrealized
Losses
Fair
Value
Cash and
Cash
Equivalents
Short-Term
Marketable
Securities
Long-Term
Marketable
Securities
Cash
$
8,529
$
—
$
—
$
8,529
$
8,529
$
—
$
—
Level 1 (1):
Money market funds
3,088
—
—
3,088
3,088
—
—
Mutual funds
1,004
—
(118
)
886
—
886
—
Subtotal
4,092
—
(118
)
3,974
3,088
886
—
Level 2 (2):
U.S. Treasury securities
52,616
77
(230
)
52,463
1,013
20,104
31,346
U.S. agency securities
5,328
3
(9
)
5,322
2,255
1,774
1,293
Non-U.S. government securities
6,987
156
(50
)
7,093
—
64
7,029
Certificates of deposit and time deposits
6,731
—
—
6,731
894
5,191
646
Commercial paper
5,187
—
—
5,187
2,683
2,504
—
Corporate securities
150,089
882
(312
)
150,659
109
27,522
123,028
Municipal securities
938
3
(2
)
939
—
127
812
Mortgage- and asset-backed securities
20,762
34
(177
)
20,619
—
16
20,603
Subtotal
248,638
1,155
(780
)
249,013
6,954
57,302
184,757
Total
$
261,259
$
1,155
$
(898
)
$
261,516
$
18,571
$
58,188
$
184,757
Apple Inc. | Q3 2017 Form 10-Q | 6
September 24, 2016
Adjusted
Cost
Unrealized
Gains
Unrealized
Losses
Fair
Value
Cash and
Cash
Equivalents
Short-Term
Marketable
Securities
Long-Term
Marketable
Securities
Cash
$
8,601
$
—
$
—
$
8,601
$
8,601
$
—
$
—
Level 1 (1):
Money market funds
3,666
—
—
3,666
3,666
—
—
Mutual funds
1,407
—
(146
)
1,261
—
1,261
—
Subtotal
5,073
—
(146
)
4,927
3,666
1,261
—
Level 2 (2):
U.S. Treasury securities
41,697
319
(4
)
42,012
1,527
13,492
26,993
U.S. agency securities
7,543
16
—
7,559
2,762
2,441
2,356
Non-U.S. government securities
7,609
259
(27
)
7,841
110
818
6,913
Certificates of deposit and time deposits
6,598
—
—
6,598
1,108
3,897
1,593
Commercial paper
7,433
—
—
7,433
2,468
4,965
—
Corporate securities
131,166
1,409
(206
)
132,369
242
19,599
112,528
Municipal securities
956
5
—
961
—
167
794
Mortgage- and asset-backed securities
19,134
178
(28
)
19,284
—
31
19,253
Subtotal
222,136
2,186
(265
)
224,057
8,217
45,410
170,430
Total
$
235,810
$
2,186
$
(411
)
$
237,585
$
20,484
$
46,671
$
170,430
(1)
Level 1 fair value estimates are based on quoted prices in active markets for identical assets or liabilities.
(2)
Level 2 fair value estimates are based on observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
The Company may sell certain of its marketable securities prior to their stated maturities for strategic reasons including, but not limited to, anticipation of credit deterioration and duration management. The maturities of the Company’s long-term marketable securities generally range from one to five years.
The Company considers the declines in market value of its marketable securities investment portfolio to be temporary in nature. The Company typically invests in highly-rated securities, and its investment policy generally limits the amount of credit exposure to any one issuer. The policy generally requires investments to be investment grade, with the primary objective of minimizing the potential risk of principal loss. Fair values were determined for each individual security in the investment portfolio. When evaluating an investment for other-than-temporary impairment, the Company reviews factors such as the length of time and extent to which fair value has been below its cost basis, the financial condition of the issuer and any changes thereto, changes in market interest rates and the Company’s intent to sell, or whether it is more likely than not it will be required to sell the investment before recovery of the investment’s cost basis. As of July 1, 2017, the Company does not consider any of its investments to be other-than-temporarily impaired.
Derivative Financial Instruments
The Company may use derivatives to partially offset its business exposure to foreign currency and interest rate risk on expected future cash flows, on net investments in certain foreign subsidiaries and on certain existing assets and liabilities. However, the Company may choose not to hedge certain exposures for a variety of reasons including, but not limited to, accounting considerations and the prohibitive economic cost of hedging particular exposures. There can be no assurance the hedges will offset more than a portion of the financial impact resulting from movements in foreign currency exchange or interest rates.
To help protect gross margins from fluctuations in foreign currency exchange rates, certain of the Company’s subsidiaries whose functional currency is the U.S. dollar may hedge a portion of forecasted foreign currency revenue, and subsidiaries whose functional currency is not the U.S. dollar and who sell in local currencies may hedge a portion of forecasted inventory purchases not denominated in the subsidiaries’ functional currencies. The Company may enter into forward contracts, option contracts or other instruments to manage this risk and may designate these instruments as cash flow hedges. The Company typically hedges portions of its forecasted foreign currency exposure associated with revenue and inventory purchases, typically for up to 12 months.
Apple Inc. | Q3 2017 Form 10-Q | 7
To help protect the net investment in a foreign operation from adverse changes in foreign currency exchange rates, the Company may enter into foreign currency forward and option contracts to offset the changes in the carrying amounts of these investments due to fluctuations in foreign currency exchange rates. In addition, the Company may use non-derivative financial instruments, such as its foreign currency-denominated debt, as economic hedges of its net investments in certain foreign subsidiaries. In both of these cases, the Company designates these instruments as net investment hedges.
The Company may also enter into non-designated foreign currency contracts to partially offset the foreign currency exchange gains and losses generated by the remeasurement of certain assets and liabilities denominated in non-functional currencies.
The Company may enter into interest rate swaps, options, or other instruments to manage interest rate risk. These instruments may offset a portion of changes in income or expense, or changes in fair value of the Company’s term debt or investments. The Company designates these instruments as either cash flow or fair value hedges. The Company’s hedged interest rate transactions as of July 1, 2017 are expected to be recognized within 10 years.
Cash Flow Hedges
The effective portions of cash flow hedges are recorded in accumulated other comprehensive income (“AOCI”) until the hedged item is recognized in earnings. Deferred gains and losses associated with cash flow hedges of foreign currency revenue are recognized as a component of net sales in the same period as the related revenue is recognized, and deferred gains and losses related to cash flow hedges of inventory purchases are recognized as a component of cost of sales in the same period as the related costs are recognized. Deferred gains and losses associated with cash flow hedges of interest income or expense are recognized in other income/(expense), net in the same period as the related income or expense is recognized. The ineffective portions and amounts excluded from the effectiveness testing of cash flow hedges are recognized in other income/(expense), net.
Derivative instruments designated as cash flow hedges must be de-designated as hedges when it is probable the forecasted hedged transaction will not occur in the initially identified time period or within a subsequent two-month time period. Deferred gains and losses in AOCI associated with such derivative instruments are reclassified immediately into other income/(expense), net. Any subsequent changes in fair value of such derivative instruments are reflected in other income/(expense), net unless they are re-designated as hedges of other transactions.
Net Investment Hedges
The effective portions of net investment hedges are recorded in other comprehensive income (“OCI”) as a part of the cumulative translation adjustment. The ineffective portions and amounts excluded from the effectiveness testing of net investment hedges are recognized in other income/(expense), net.
Fair Value Hedges
Gains and losses related to changes in fair value hedges are recognized in earnings along with a corresponding loss or gain related to the change in value of the underlying hedged item.
Non-Designated Derivatives
Derivatives that are not designated as hedging instruments are adjusted to fair value through earnings in the financial statement line item to which the derivative relates. As a result, during the three- and nine-month periods ended July 1, 2017, respectively, the Company recognized a loss of $77 million and a gain of $129 million in net sales, gains of $12 million and $91 million in cost of sales and gains of $49 million and $481 million in other income/(expense), net.
The Company records all derivatives in the Condensed Consolidated Balance Sheets at fair value. The Company’s accounting treatment for these derivative instruments is based on its hedge designation. The following tables show the Company’s derivative instruments at gross fair value as of July 1, 2017 and September 24, 2016 (in millions):
July 1, 2017
Fair Value of
Derivatives Designated
as Hedge Instruments
Fair Value of
Derivatives Not Designated
as Hedge Instruments
Total
Fair Value
Derivative assets (1):
Foreign exchange contracts
$
485
$
242
$
727
Interest rate contracts
$
253
$
—
$
253
Derivative liabilities (2):
Foreign exchange contracts
$
842
$
362
$
1,204
Interest rate contracts
$
264
$
—
$
264
Apple Inc. | Q3 2017 Form 10-Q | 8
September 24, 2016
Fair Value of
Derivatives Designated
as Hedge Instruments
Fair Value of
Derivatives Not Designated
as Hedge Instruments
Total
Fair Value
Derivative assets (1):
Foreign exchange contracts
$
518
$
153
$
671
Interest rate contracts
$
728
$
—
$
728
Derivative liabilities (2):
Foreign exchange contracts
$
935
$
134
$
1,069
Interest rate contracts
$
7
$
—
$
7
(1)
The fair value of derivative assets is measured using Level 2 fair value inputs and is recorded as other current assets in the Condensed Consolidated Balance Sheets.
(2)
The fair value of derivative liabilities is measured using Level 2 fair value inputs and is recorded as accrued expenses in the Condensed Consolidated Balance Sheets.
The following table shows the pre-tax gains and losses of the Company’s derivative and non-derivative instruments designated as cash flow, net investment and fair value hedges in OCI and the Condensed Consolidated Statements of Operations for the three- and nine-month periods ended July 1, 2017 and June 25, 2016 (in millions):
Three Months Ended
Nine Months Ended
July 1, 2017
June 25, 2016
July 1, 2017
June 25, 2016
Gains/(Losses) recognized in OCI – effective portion:
Cash flow hedges:
Foreign exchange contracts
$
(143
)
$
(170
)
$
1,267
$
18
Interest rate contracts
(2
)
(11
)
7
(53
)
Total
$
(145
)
$
(181
)
$
1,274
$
(35
)
Net investment hedges:
Foreign currency debt
$
16
$
(128
)
$
53
$
(205
)
Gains/(Losses) reclassified from AOCI into net income – effective portion:
Cash flow hedges:
Foreign exchange contracts
$
585
$
142
$
1,418
$
1,325
Interest rate contracts
—
(3
)
(3
)
(10
)
Total
$
585
$
139
$
1,415
$
1,315
Gains/(Losses) on derivative instruments:
Fair value hedges:
Interest rate contracts
$
185
$
345
$
(737
)
$
484
Gains/(Losses) related to hedged items:
Fair value hedges:
Fixed-rate debt
$
(185
)
$
(345
)
$
737
$
(484
)
Apple Inc. | Q3 2017 Form 10-Q | 9
The following table shows the notional amounts of the Company’s outstanding derivative instruments and credit risk amounts associated with outstanding or unsettled derivative instruments as of July 1, 2017 and September 24, 2016 (in millions):
July 1, 2017
September 24, 2016
Notional
Amount
Credit Risk
Amount
Notional
Amount
Credit Risk
Amount
Instruments designated as accounting hedges:
Foreign exchange contracts
$
43,700
$
485
$
44,678
$
518
Interest rate contracts
$
31,500
$
253
$
24,500
$
728
Instruments not designated as accounting hedges:
Foreign exchange contracts
$
48,774
$
242
$
54,305
$
153
The notional amounts for outstanding derivative instruments provide one measure of the transaction volume outstanding and do not represent the amount of the Company’s exposure to credit or market loss. The credit risk amounts represent the Company’s gross exposure to potential accounting loss on derivative instruments that are outstanding or unsettled if all counterparties failed to perform according to the terms of the contract, based on then-current currency or interest rates at each respective date. The Company’s exposure to credit loss and market risk will vary over time as currency and interest rates change. Although the table above reflects the notional and credit risk amounts of the Company’s derivative instruments, it does not reflect the gains or losses associated with the exposures and transactions that the instruments are intended to hedge. The amounts ultimately realized upon settlement of these financial instruments, together with the gains and losses on the underlying exposures, will depend on actual market conditions during the remaining life of the instruments.
The Company generally enters into master netting arrangements, which are designed to reduce credit risk by permitting net settlement of transactions with the same counterparty. To further limit credit risk, the Company generally enters into collateral security arrangements that provide for collateral to be received or posted when the net fair value of certain financial instruments fluctuates from contractually established thresholds. The Company presents its derivative assets and derivative liabilities at their gross fair values in its Condensed Consolidated Balance Sheets. As of July 1, 2017, the net cash collateral posted by the Company related to derivative instruments under its collateral security arrangements was $162 million, which was recorded as other current assets in the Condensed Consolidated Balance Sheet. As of September 24, 2016, the net cash collateral received by the Company related to derivative instruments under its collateral security arrangements was $163 million, which was recorded as accrued expenses in the Condensed Consolidated Balance Sheet.
Under master netting arrangements with the respective counterparties to the Company’s derivative contracts, the Company is allowed to net settle transactions with a single net amount payable by one party to the other. As of July 1, 2017 and September 24, 2016, the potential effects of these rights of set-off associated with the Company’s derivative contracts, including the effects of collateral, would be a reduction to both derivative assets and derivative liabilities of $1.3 billion and $1.5 billion, respectively, resulting in a net derivative liability of $326 million and a net derivative asset of $160 million, respectively.
Accounts Receivable
Trade Receivables
The Company has considerable trade receivables outstanding with its third-party cellular network carriers, wholesalers, retailers, value-added resellers, small and mid-sized businesses and education, enterprise and government customers. The Company generally does not require collateral from its customers; however, the Company will require collateral in certain instances to limit credit risk. In addition, when possible, the Company attempts to limit credit risk on trade receivables with credit insurance for certain customers or by requiring third-party financing, loans or leases to support credit exposure. These credit-financing arrangements are directly between the third-party financing company and the end customer. As such, the Company generally does not assume any recourse or credit risk sharing related to any of these arrangements.
The Company had no customers that individually represented 10% or more of total trade receivables as of July 1, 2017. As of September 24, 2016, the Company had one customer that represented 10% or more of total trade receivables, which accounted for 10%. The Company’s cellular network carriers accounted for 46% and 63% of total trade receivables as of July 1, 2017 and September 24, 2016, respectively.
Vendor Non-Trade Receivables
The Company has non-trade receivables from certain of its manufacturing vendors resulting from the sale of components to these vendors who manufacture sub-assemblies or assemble final products for the Company. The Company purchases these components directly from suppliers. As of July 1, 2017, the Company had three vendors that individually represented 10% or more of total vendor non-trade receivables, which accounted for 39%, 19% and 16%. As of September 24, 2016, the Company had two vendors that individually represented 10% or more of total vendor non-trade receivables, which accounted for 47% and 21%.
The following tables show the Company’s condensed consolidated financial statement details as of July 1, 2017 and September 24, 2016 (in millions):
Property, Plant and Equipment, Net
July 1, 2017
September 24, 2016
Land and buildings
$
12,529
$
10,185
Machinery, equipment and internal-use software
49,491
44,543
Leasehold improvements
6,961
6,517
Gross property, plant and equipment
68,981
61,245
Accumulated depreciation and amortization
(39,695
)
(34,235
)
Total property, plant and equipment, net
$
29,286
$
27,010
Other Non-Current Liabilities
July 1, 2017
September 24, 2016
Deferred tax liabilities
$
30,191
$
26,019
Other non-current liabilities
8,407
10,055
Total other non-current liabilities
$
38,598
$
36,074
Other Income/(Expense), Net
The following table shows the detail of other income/(expense), net for the three- and nine-month periods ended July 1, 2017 and June 25, 2016 (in millions):
Three Months Ended
Nine Months Ended
July 1, 2017
June 25, 2016
July 1, 2017
June 25, 2016
Interest and dividend income
$
1,327
$
1,036
$
3,833
$
2,963
Interest expense
(602
)
(409
)
(1,657
)
(1,006
)
Other expense, net
(185
)
(263
)
(228
)
(1,036
)
Total other income/(expense), net
$
540
$
364
$
1,948
$
921
Note 4 – Acquired Intangible Assets
The Company’s acquired intangible assets with definite useful lives primarily consist of patents and licenses. The following table summarizes the components of acquired intangible asset balances as of July 1, 2017 and September 24, 2016 (in millions):
July 1, 2017
September 24, 2016
Gross
Carrying Amount
Accumulated
Amortization
Net
Carrying Amount
Gross
Carrying Amount
Accumulated
Amortization
Net
Carrying Amount
Definite-lived and amortizable acquired intangible assets
$
7,358
$
(5,014
)
$
2,344
$
8,912
$
(5,806
)
$
3,106
Indefinite-lived and non-amortizable acquired intangible assets
100
—
100
100
—
100
Total acquired intangible assets
$
7,458
$
(5,014
)
$
2,444
$
9,012
$
(5,806
)
$
3,206
Apple Inc. | Q3 2017 Form 10-Q | 11
Note 5 – Income Taxes
As of July 1, 2017, the Company recorded gross unrecognized tax benefits of $8.6 billion, of which $2.6 billion, if recognized, would affect the Company’s effective tax rate. As of September 24, 2016, the total amount of gross unrecognized tax benefits was $7.7 billion, of which $2.8 billion, if recognized, would have affected the Company’s effective tax rate. The Company’s total gross unrecognized tax benefits are classified as other non-current liabilities in the Condensed Consolidated Balance Sheets. The Company had $1.3 billion and $1.0 billion of gross interest and penalties accrued as of July 1, 2017 and September 24, 2016, respectively, which are classified as other non-current liabilities in the Condensed Consolidated Balance Sheets.
The Company believes that an adequate provision has been made for any adjustments that may result from tax examinations. However, the outcome of tax audits cannot be predicted with certainty. If any issues addressed in the Company’s tax audits are resolved in a manner not consistent with its expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. Although timing of the resolution and/or closure of audits is not certain, the Company believes it is reasonably possible that its gross unrecognized tax benefits could decrease (whether by payment, release or a combination of both) in the next 12 months by as much as $700 million.
On August 30, 2016, the European Commission announced its decision that Ireland granted state aid to the Company by providing tax opinions in 1991 and 2007 concerning the tax allocation of profits of the Irish branches of two subsidiaries of the Company (the “State Aid Decision”). The State Aid Decision orders Ireland to calculate and recover additional taxes from the Company for the period June 2003 through December 2014. Irish legislative changes, effective as of January 2015, eliminated the application of the tax opinions from that date forward. The Company believes the State Aid Decision to be without merit and appealed to the General Court of the Court of Justice of the European Union. Ireland has also appealed the State Aid Decision. While the European Commission announced a recovery amount of up to €13 billion, plus interest, the actual amount of additional taxes subject to recovery is to be calculated by Ireland in accordance with the European Commission’s guidance. Once the recovery amount is computed by Ireland, the Company anticipates funding it, including interest, out of foreign cash into escrow, where it will remain pending conclusion of all appeals. The Company believes that any incremental Irish corporate income taxes potentially due related to the State Aid Decision would be creditable against U.S. taxes.
Note 6 – Debt
Commercial Paper
The Company issues unsecured short-term promissory notes (“Commercial Paper”) pursuant to a commercial paper program. The Company uses net proceeds from the commercial paper program for general corporate purposes, including dividends and share repurchases. As of July 1, 2017 and September 24, 2016, the Company had $12.0 billion and $8.1 billion of Commercial Paper outstanding, respectively, with maturities generally less than nine months. The weighted-average interest rate of the Company’s Commercial Paper was 1.01% as of July 1, 2017 and 0.45% as of September 24, 2016.
The following table provides a summary of cash flows associated with the issuance and maturities of Commercial Paper for the nine months ended July 1, 2017 and June 25, 2016 (in millions):
Nine Months Ended
July 1, 2017
June 25, 2016
Maturities less than 90 days:
Proceeds from/(Repayments of) commercial paper, net
$
(143
)
$
4,154
Maturities greater than 90 days:
Proceeds from commercial paper
12,633
1,846
Repayments of commercial paper
(8,624
)
(2,008
)
Proceeds from/(Repayments of) commercial paper, net
4,009
(162
)
Total change in commercial paper, net
$
3,866
$
3,992
Apple Inc. | Q3 2017 Form 10-Q | 12
Term Debt
As of July 1, 2017, the Company had outstanding floating- and fixed-rate notes with varying maturities for an aggregate principal amount of $96.6 billion (collectively the “Notes”). The Notes are senior unsecured obligations, and interest is payable in arrears, quarterly for the U.S. dollar-denominated and Australian dollar-denominated floating-rate notes, semi-annually for the U.S. dollar-denominated, Australian dollar-denominated, British pound-denominated and Japanese yen-denominated fixed-rate notes and annually for the euro-denominated and Swiss franc-denominated fixed-rate notes. The following table provides a summary of the Company’s term debt as of July 1, 2017 and September 24, 2016:
Maturities
July 1, 2017
September 24, 2016
Amount
(in millions)
Effective
Interest Rate
Amount
(in millions)
Effective
Interest Rate
2013 debt issuance of $17.0 billion:
Floating-rate notes
2018
2018
$
2,000
1.10%
1.10
%
$
2,000
1.10%
1.10
%
Fixed-rate 1.000% – 3.850% notes
2018
–
2043
12,500
1.08%
–
3.91
%
12,500
1.08%
–
3.91
%
2014 debt issuance of $12.0 billion:
Floating-rate notes
2019
–
2019
1,000
1.48%
1.48
%
2,000
0.86%
–
1.09
%
Fixed-rate 2.100% – 4.450% notes
2019
–
2044
8,500
1.48%
–
4.48
%
10,000
0.85%
–
4.48
%
2015 debt issuances of $27.3 billion:
Floating-rate notes
2019
–
2020
1,532
1.43%
–
1.87
%
1,781
0.87%
–
1.87
%
Fixed-rate 0.350% – 4.375% notes
2019
–
2045
24,259
0.28%
–
4.51
%
25,144
0.28%
–
4.51
%
2016 debt issuances of $24.9 billion:
Floating-rate notes
2019
–
2021
1,350
1.31%
–
2.32
%
1,350
0.91%
–
1.95
%
Fixed-rate 1.100% – 4.650% notes
2018
–
2046
23,610
1.13%
–
4.78
%
23,609
1.13%
–
4.58
%
Second quarter 2017 debt issuance of $10.0 billion:
Floating-rate notes
2019
500
1.26
%
—
—
%
Floating-rate notes
2020
500
1.38
%
—
—
%
Floating-rate notes
2022
1,000
1.68
%
—
—
%
Fixed-rate 1.550% notes
2019
500
1.59
%
—
—
%
Fixed-rate 1.900% notes
2020
1,000
1.38
%
—
—
%
Fixed-rate 2.500% notes
2022
1,500
1.67
%
—
—
%
Fixed-rate 3.000% notes
2024
1,750
1.98
%
—
—
%
Fixed-rate 3.350% notes
2027
2,250
2.12
%
—
—
%
Fixed-rate 4.250% notes
2047
1,000
4.26
%
—
—
%
Second quarter 2017 debt issuance of $1.0 billion: