2008 Apple 10k

Created by EDGAR Online, Inc.
APPLE INC
TABLE1
Form Type: 10-K
Period End: Sep 27, 2008
Date Filed: Nov 05, 2008
APPLE INC.
(Exact name of registrant as specified in its charter)
California
(State or other jurisdiction
of incorporation or organization)
94-2404110
(I.R.S. Employer
Identification No.)
1 Infinite Loop
Cupertino, California
(Address of principal executive offices)
(Zip Code)
95014
Registrant's telephone number, including area code: (408) 996-1010

APPLE INC
TABLE2
Form Type: 10-K
Large accelerated filer [x]
Non-accelerated filer
[ ] (Do not check if smaller
reporting company)
Accelerated filer
[]
Smaller Reporting Company
[]

APPLE INC
NAME_AND_TITLE
Form Type: 10-K
Executive Officers of the Registrant
The following sets forth certain information regarding executive officers of the
Company as of November 1, 2008.
Name
Timothy D. Cook
Daniel Cooperman
Tony Fadell
Scott Forstall
Steven P. Jobs
Ronald B. Johnson
Robert Mansfield
Peter Oppenheimer
Philip W. Schiller
Bertrand Serlet
Sina Tamaddon
Position With the Company

Chief Operating Officer
Senior Vice President, General Counsel and
Secretary
Senior Vice President, iPod Division
Senior Vice President, iPhone Software
Engineering and Platform Experience
Director and Chief Executive Officer
Senior Vice President, Retail
Senior Vice President, Hardware Engineering
Senior Vice President and Chief Financial
Officer
Senior Vice President, Worldwide Product
Marketing
Senior Vice President, Software Engineering
Senior Vice President, Applications
Age
47
57
39
39
53
50
47
45
48
47
51

APPLE INC
TABLE3
Form Type: 10-K
Price Range of Common Stock
The price range per share of common stock presented below represents the highest
and lowest sales prices for the Company's common stock on the NASDAQ Global
Select Market during each quarter of the two most recent fiscal years.
Fourth Quarter
Fiscal 2008 price
range per common
share
Fiscal 2007 price
range per common
share
Third Quarter
180.91
120.68
192.24
155.00
111.62
127.61
elow represents the highest

he NASDAQ Global
nt fiscal years.
Second Quarter
First Quarter
142.52
200.50
115.44
202.96
150.63
89.60
97.80
81.90
93.16
72.60

APPLE INC
TABLE4
Form Type: 10-K
Apple Inc.
S&P 500
S&P Computer Hardware
Sep-03
$
$
$
100
100
100
Sep-04
$
$
$
187
114
104
Sep-05
$
$
$
517
128
119
Sep-06
$
$
$
743
142
128
Sep-07
$
$
$
1,481
165
188
Sep-08
$
$
$
1,097
129
158

APPLE INC
TABLE5
Form Type: 10-K
Net sales
Net income
Earnings per common share:
Basic
Diluted
Cash dividends declared per common
share
Shares used in computing earnings
per share:
Basic
Diluted
Cash, cash equivalents, and
short-term investments
Total assets
Long-term debt
Total liabilities
Shareholders' equity
$
$
2008
32,479 $
4,834 $
$
$
5.48
5.36
$
$
$
881,592
902,139
$
$
$
$
$
24,490
39,572
18,542
21,030
2007
24,006
3,496
4.04
3.93
-
864,595
889,292
$
$
$
$
$
15,386
25,347
10,815
14,532
$
$
2006
19,315 $
1,989 $
2005
13,931 $
1,328 $
2004
8,279
266
$
$
2.36
2.27
1.64
1.55
0.36
0.34
$
$
$
844,058
877,526
$
$
$
$
$
10,110
17,205
7,221
9,984
$
$
$
808,439
856,878
$
$
$
$
$
8,261
11,516
4,088
7,428
743,180
774,776
$
$
$
$
$
5,464
8,039
2,976
5,063

APPLE INC
TABLE6
Form Type: 10-K
2008 Change
Net Sales by Operating Segment:
Americas net sales
Europe net sales
Japan net sales
Retail net sales
Other Segments net sales (a)
Total net sales
2007
14,573
7,622
1,509
6,315
2,460
26% $
40%
39%
53%
40%
11,596
5,460
1,082
4,115
1,753
32,479
35% $
24,006
Unit Sales by Operating Segment:

Americas Mac unit sales
Europe Mac unit sales
Japan Mac unit sales
Retail Mac unit sales
Other Segments Mac unit sales (a)
3,980
2,519
389
2,034
793
32%
39%
29%
47%
50%
3,019
1,816
302
1,386
528
Total Mac unit sales
9,715
38%
7,051
5,603
8,673
39% $
38%
4,020
6,294
Net Sales by Product:

Desktops (b)
Portables (c)
Total Mac net sales

iPod
Other music related products and
services (d)
iPhone and related products and
services (e)
Peripherals and other hardware
(f)
Software, service, and other
sales (g)
Total net sales
14,276
38%
10,314
9,153
10%
8,305
3,340
34%
2,496
1,844 N M
123
1,659
32%
1,260
2,207
46%
1,508
32,479
35% $
24,006
Unit Sales by Product:

Desktops (b)
Portables (c)
3,712
6,003
37%
38%
2,714
4,337
Total Mac unit sales
9,715
38%
7,051
Net sales per Mac unit sold (h)
1,469
0% $
1,463
iPod unit sales

Net sales per iPod unit sold (i)
iPhone unit sales
54,828
$
167
11,627 N M
6%
4% $
51,630
161
1,389
Change
2006
23% $
33%
-11%
27%
30%
9,415
4,096
1,211
3,246
1,347
24% $
19,315
24%
35%
-1%
56%
58%
2,432
1,346
304
886
335
33%
5,303
21% $
55%
3,319
4,056
40%
7,375
8%
7,676
32%
1,885
NM
15%
1,100
18%
1,279
24% $
19,315
12%
51%
2,434
2,869
33%
5,303
5% $
1,391
31%
-17% $
NM
39,409
195
-

APPLE INC
TABLE7
Form Type: 10-K
Gross Margin
Gross margin for the three fiscal years ended September 27, 2008, are as follows
(in millions, except gross margin percentages):
Net sales
Cost of sales
2008
32,479 $
21,334
Gross margin
11,145
Gross margin percentage
34.30%
2007
24,006 $
15,852
8,154
34.00%
2006
19,315
13,717
5,598
29.00%

APPLE INC
TABLE8
Form Type: 10-K
Operating Expenses
Operating expenses for the three fiscal years ended September 27, 2008, are as
follows (in millions, except for percentages):
Research and development

Percentage of net sales
Selling, general, and administrative
Percentage of net sales
$
$
2008
1,109 $
3.40%
3,761 $
11.60%
2007
782
3.30%
2,963
12.30%
, 2008, are as
$
$
2006
712
3.70%
2,433
12.60%

APPLE INC
TABLE9
Form Type: 10-K
Other Income and Expense
Other income and expense for the three fiscal years ended September 27, 2008,
are as follows (in millions):
Interest income
Other income (expense), net
2008
653 $
(33)
Total other income and expense
620
2007
647 $
(48)
2006
394
(29)
599
365

APPLE INC
TABLE10
Form Type: 10-K
Cash, cash equivalents, and short-term investments

Accounts receivable, net
Inventory
Working capital
Annual operating cash flow
$
$
$
$
$
2008
24,490
2,422
509
20,598
9,596
$
$
$
$
$
2007
15,386
1,637
346
12,676
5,470
$
$
$
$
$
2006
10,110
1,252
270
8,066
2,220

APPLE INC
TABLE11
Form Type: 10-K
Operating leases
Purchase obligations
Asset retirement obligations
Other obligations
Total
Total
$
1,760
5,378
28
471
7,637
Payments Due
Payments
Payments
in Less
Due in
Due in
Than 1 Year
1-3 Years
4-5
$
195
$
409
5,378
8
242
124
$
5,815
541
Payments
Payments Due
Due in
in More
Years
Than 5 Years
$
368 $
788
7
13
105
$
480
801

APPLE INC
BALANCE_SHEET
Form Type: 10-K
September 27, 2008
ASSETS:
Current assets:
Cash and cash equivalents
Short-term investments
Accounts receivable, less allowances of
$47 in each period
Inventories
Deferred tax assets
Other current assets
2,422
509
1,447
5,822
Total current assets

Property, plant, and equipment, net
Goodwill
Acquired intangible assets, net
Other assets
Total assets
LIABILITIES AND SHAREHOLDERS' EQUITY:
Current liabilities:
Accounts payable
Accrued expenses
11,875
12,615
34,690
2,455
207
285
1,935
$
39,572
5,520
8,572
Total current liabilities

Non-current liabilities
14,092
4,450
Total liabilities
18,542
Commitments and contingencies

Shareholders' equity:
Common stock, no par value;
1,800,000,000 shares authorized;
888,325,973 and 872,328,972 shares
issued and outstanding, respectively
Retained earnings
Accumulated other comprehensive income
7,177
13,845
8
Total shareholders' equity
21,030
Total liabilities and shareholders'

equity
39,572
September 29, 2007
9,352
6,034
1,637
346
782
3,805
21,956
1,832
38
299
1,222
25,347
4,970
4,310
9,280
1,535
10,815
5,368
9,101
63
14,532
25,347

APPLE INC
INCOME_STATEMENT
Form Type: 10-K
CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except share amounts which are reflected in thousands and per
share amounts)
Three fiscal years ended September 27, 2008

Net sales
Cost of sales (1)
Gross margin
2008
32,479 $
21,334
2007
24,006
15,852
11,145
8,154
Operating expenses:
Research and development (1)
Selling, general, and administrative (1)
1,109
3,761
782
2,963
Total operating expenses
4,870
3,745
Operating income
Other income and expense
6,275
620
4,409
599
Income before provision for income taxes

Provision for income taxes
6,895
2,061
5,008
1,512
Net income
4,834
3,496

Basic
Diluted
$
$
5.48
5.36
$
$
4.04
3.93
Shares used in computing earnings per share:

Basic
Diluted
881,592
902,139
864,595
889,292
2006
19,315
13,717
5,598
712
2,433
3,145
2,453
365
2,818
829
$
1,989
$
$
2.36
2.27
844,058
877,526

APPLE INC
TABLE12
Form Type: 10-K
Cost of sales
Research and development
Selling, general, and administrative
$
$
$
80
185
251
$
$
$
35
77
130
$
$
$
21
53
89

APPLE INC
STOCKHOLDERS_EQUITY
Form Type: 10-K
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(In millions, except share amounts which are reflected in thousands)
Common Stock
Shares
Balances as of September 24,
2005
Components of comprehensive
income:
Net income
Change in foreign currency
translation
Change in unrealized gain on
available-for-sale securities,
net of tax
derivative instruments, net of
tax
Total comprehensive income
Common stock repurchased
Stock-based compensation
Deferred compensation
Common stock issued under
stock plans
Tax benefit from employee
stock plan awards
2006
income:
Net income
translation
Change in unrealized loss on
net of tax
Deferred Stock
Compensation
Amount
835,019
3,564
(61)
(4,574)
-
(48)
163
(61)
24,818
318
419
4,355
855,263
61

tax
stock plans, net of shares
withheld for employee taxes
stock plan awards
2007
Cumulative effect of change in
accounting principle
income:
Net income
translation
Change in unrealized loss on
net of tax
tax
stock plans, net of shares
withheld for employee taxes
Issuance of common stock in
connection with an asset
acquisition
stock plan awards
2008
251
17,066
364
398
5,368
45
872,329
513
15,888
460
109
21
770
888,326
7,177
Accumulated
Other
Comprehensive
Income
Retained
Earnings
$
3,925
1,989
Total
Shareholders'
Equity
-
7,428
1,989
19
19
(1)
(1)
2,011
(355)
163
-
318
419
(307)
-
5,607
3,496
22
9,984
3,496
51
51
(7)
(7)
(3)
(2)
-
3,537
251
362
398
9,101
11
(3)
63
14,532
56
4,834
-
(11)
(11)
(63)
(63)
19
19
4,779
513
359
21
770
(101)
4,834
13,845 $8
21,030

APPLE INC
CASH_FLOW
Form Type: 10-K
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
Three fiscal years ended September 27, 2008

Cash and cash equivalents, beginning of the year
Operating Activities:
Net income
Adjustments to reconcile net income to cash
generated by operating activities:
Depreciation, amortization and accretion
Stock-based compensation expense
Provision for deferred income taxes
Loss on disposition of property, plant, and
equipment
Changes in operating assets and liabilities:
Accounts receivable, net
Inventories
Other assets
Accounts payable
Deferred revenue
Other liabilities
Cash generated by operating activities
Investing Activities:
Purchases of short-term investments
Proceeds from maturities of short-term investments
Proceeds from sales of short-term investments
Purchases of long-term investments
Payments made in connection with business
acquisitions, net of cash acquired
Payment for acquisition of property, plant, and
equipment
Payment for acquisition of intangible assets
Other
Cash (used in)/generated by investing activities
Financing Activities:
2008
9,352
4,834
473
516
(368)
22
(785)
(163)
(1,958)
(492)
596
5,642
1,279
9,596
(22,965)
11,804
4,439
(38)
(220)
(1,091)
(108)
(10)
(8,189)
Proceeds from issuance of common stock

Excess tax benefits from stock-based compensation
Cash used to net share settle equity awards
483
757
(124)
Cash generated by financing activities
1,116
Increase in cash and cash equivalents
2,523
Cash and cash equivalents, end of the year
11,875
Supplemental cash flow disclosures:

Cash paid for income taxes, net
1,267
2007
6,392 $
2006
3,491
3,496
1,989
317
242
78
225
163
53
12
15
(385)
(76)
(1,540)
81
1,494
1,139
612
(357)
(105)
(1,626)
(1,040)
1,611
319
973
5,470
2,220
(11,719)
6,483
2,941
(17)
(7,255)
7,226
1,086
(25)
(735)
(251)
49
(3,249)
(657)
(28)
10
357
365
377
(3)
318
361
(355)
739
324
2,960
2,901
9,352
6,392
863
194

APPLE INC
TABLE13
Form Type: 10-K
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Note 1-Summary of Significant Accounting Policies (Continued)
The following table sets forth the computation of basic and diluted earnings per
share for the three fiscal years ended September 27, 2008 (in thousands, except
net income in millions and per share amounts):
2008
Numerator:
Net income
4,834
2007
$
3,496
Denominator:
Weighted-average shares outstanding
Effect of dilutive securities
881,592
20,547
864,595
24,697
Denominator for diluted earnings per share
902,139
889,292
Basic earnings per share
5.48
4.04
Diluted earnings per share
5.36
3.93
nings per
ds, except
2006
$
1,989
844,058
33,468
877,526
$
2.36
2.27

APPLE INC
TABLE14
Form Type: 10-K
Note 2-Financial Instruments
Cash, Cash Equivalents and Short-Term Investments

The following table summarizes the fair value of the Company's cash and
available-for-sale securities held in its short-term investment portfolio,
recorded as cash and cash equivalents or short-term investments as of
September 27, 2008 and September 29, 2007 (in millions):
Cash
U.S. Treasury and Agency Securities
U.S. Corporate Securities
Foreign Securities
Total cash equivalents
U.S. Treasury and Agency Securities
Foreign Securities
Total short-term investments
Total cash, cash equivalents, and short-term investments
s cash and
portfolio,
ents as of
2008
368 $
2007
256
2,916
4,975
3,616
670
5,597
2,829
11,507
9,096
7,018
4,305
1,292
358
4,718
958
12,615
6,034
24,490
15,386

APPLE INC
TABLE15
Form Type: 10-K
2008
12 Months or Greater
Less than 12 Months

Security Description
U.S. Treasury and Agency
Securities
Foreign Securities
Total
Unrealized
Loss
Fair Value
Fair Value
6,850
2,536
321
(13) $
(31)
-
1,030
118
9,707
(44) $
1,148
2007
Less than 12 Months

Security Description
U.S. Treasury and Agency
Securities
Foreign Securities
Total
Unrealized
Loss
Fair Value
$
338
2,521
474
3,333
Fair Value
$
(12)
(1)
(13) $
32
8
40
2008
Unrealized
Loss
Total
Unrealized
Loss
Fair Value
$
$
(72)
(5)
6,850
3,566
439
(13)
(103)
(5)
(77) $
10,855
(121)
2007
Unrealized
Loss
Total
Unrealized
Loss
Fair Value
$
338
2,553
482
(12)
(1)
3,373
(13)

APPLE INC
TABLE16
Form Type: 10-K
Note 2-Financial Instruments (Continued)
The following table summarizes the activity in the allowance for doubtful
accounts for the three fiscal years ended September 27, 2008 (in millions):
Beginning allowance balance

Charged to costs and expenses
Deductions
Ending allowance balance
2008
47 $
3
(3)
47
2007
52 $
12
(17)
47
2006
46
17
(11)
52

APPLE INC
TABLE17
Form Type: 10-K
2008
Notional
Principal
Fair
Value
Credit Risk
Amounts
Notional
Principal
Foreign exchange instruments

qualifying as accounting
hedges:
Spot/Forward contracts
Purchased options
Sold options
$
$
$
2,782
3,120
2,668
$
$
$
(2) $
64 $
(23) $
$
$
2,633 $3
235 $3
$5
$3
43
64
-
$
$
$
570
2,564
1,498
$
$
1,768
161
Foreign exchange instruments

other than accounting
hedges:
Spot/Forward contracts
Purchased options
2007
Fair
Value
Credit Risk
Amounts
$
$
$
(8) $
10 $
(2) $
$
$1
(2) $
$1
10
-

APPLE INC
TABLE18
Form Type: 10-K
Other Current Assets
Vendor non-trade receivables

Deferred costs under subscription accounting-current
NAND flash memory prepayments
Total other current assets
2008
2,282 $
1,931
475
1,134
2007
2,392
247
417
749
5,822
3,805

APPLE INC
TABLE19
Form Type: 10-K
Property, Plant, and Equipment
Land and buildings

Machinery, equipment, and internal-use software
Office furniture and equipment
Leasehold improvements
Accumulated depreciation and amortization

Net property, plant, and equipment
2008
810 $
1,491
122
1,324
2007
762
954
106
1,019
3,747
2,841
(1,292)
(1,009)
2,455
1,832

APPLE INC
TABLE20
Form Type: 10-K
Other Assets
Deferred costs under subscription accounting-non-current

Long-term NAND flash memory prepayments
Deferred tax assets-non-current
Capitalized software development costs, net
Other assets
Total other assets
2008
1,089
208
138
67
433
1,935
2007
214
625
88
83
212
1,222

APPLE INC
TABLE21
Form Type: 10-K
Accrued Expenses
Deferred revenue-current
Deferred margin on component sales
Accrued marketing and distribution
Accrued compensation and employee benefits
Accrued warranty and related costs
Other accrued tax liabilities
Other current liabilities
Total accrued expenses
2008
4,853 $
681
329
320
267
100
2,022
2007
1,391
545
288
254
230
488
1,114
8,572
4,310

APPLE INC
TABLE22
Form Type: 10-K
Note 3-Consolidated Financial Statement Details (Continued)
Non-Current Liabilities
Deferred revenue-non-current
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities
2008
3,029 $
675
746
4,450
2007
849
619
67
1,535

APPLE INC
TABLE23
Form Type: 10-K
Note 4-Goodwill and Other Intangible Assets
The Company is currently amortizing its acquired intangible assets with definite
lives over periods ranging from 1 to 10 years. The following table summarizes
the components of gross and net intangible asset balances as of September 27,
2008 and September 29, 2007 (in millions):
2008
Gross
Carrying
Amount
Definite lived and
amortizable acquired
technology
Indefinite lived and
unamortizable trademarks
Accumulated
Amortization
308
100
Net
Carrying
Amount
(123) $
-
Total acquired intangible

assets
408
Goodwill
207
185
100
(123) $
-
Gross
Carrying
Amount
276
100
285
376
207
38
2007
Accumulated
Amortization
Net
Carrying
Amount
(77) $
199
100
(77) $
299
38

APPLE INC
TABLE24
Form Type: 10-K
Fiscal Years
2009 $
2010
2011
2012
2013
Thereafter
Total
50
35
32
26
13
29
185

APPLE INC
TABLE25
Form Type: 10-K
Note 5-Income Taxes
2008,
The provision for income taxes for the three fiscal years ended September 27,
consisted of the following (in millions):
2008
Federal:
Current
Deferred
State:
Current
Deferred
Foreign:
Current
Deferred
2007
1,942 $
(155)
1,219
85
1,787
1,304
210
(82)
112
9
128
121
277
(131)
103
(16)
146
87
2,061
1,512
ber 27,
2006
$
619
56
675
56
14
70
101
(17)
84
$
829

APPLE INC
TABLE26
Form Type: 10-K
Note 5-Income Taxes (Continued)
As of September 27, 2008 and September 29, 2007, the significant components of
the Company's deferred tax assets and liabilities were (in millions):
Deferred tax assets:

Accrued liabilities and other reserves
Basis of capital assets and investments
Accounts receivable and inventory reserves
Tax losses and credits
Other
Total deferred tax assets
Less valuation allowance
Net deferred tax assets
Deferred tax liabilities-Unremitted earnings of subsidiaries:
Net deferred tax asset
components of
2008
$
1,295
173
126
47
503
2007
$
679
146
64
8
161
2,144
-
1,058
5
2,144
1,053
1,234
803
910
250

APPLE INC
TABLE27
Form Type: 10-K
Computed expected tax

State taxes, net of federal effect
Indefinitely invested earnings of foreign subsidiaries
Nondeductible executive compensation
Research and development credit, net
Other items
Effective tax rate
2008
2,414 $
159
(492)
6
(21)
(5)
2007
1,753
140
(297)
6
(54)
(36)
2,061
1,512
30%
30%
2006
987
86
(224)
11
(12)
(19)
829
29%

APPLE INC
TABLE28
Form Type: 10-K
Balance as of September 30, 2007
Increases related to tax positions taken during a prior period
Decreases related to tax positions taken during a prior period
Increases related to tax positions taken during the current period
Decreases related to settlements with taxing authorities
Decreases related to expiration of statute of limitations
475
27
(70)
85
(11)
Balance as of September 27, 2008
506

APPLE INC
TABLE29
Form Type: 10-K
Unrealized losses on available-for-sale securities

Unrealized gains on derivative instruments
Cumulative foreign currency translation
Accumulated other comprehensive income
$8
2008
(70) $
19
59
$
2007
(7)
70
63
2006
3
19
22

APPLE INC
TABLE30
Form Type: 10-K
Note 6-Shareholders' Equity (Continued)
The following table summarizes activity in other comprehensive income related to

derivatives, net of taxes, held by the Company during the three fiscal years
ended September 27, 2008 (in millions):
Changes in fair value of derivatives

Adjustment for net gains/(losses) realized and included in
net income
Change in unrealized gains on derivative instruments
nsive income related to

iscal years
2008
$7
$
12
19
2007
(1) $
2006
11
(2)
(12)
(3) $
(1)

APPLE INC
TABLE31
Form Type: 10-K
Note 6-Shareholders' Equity (Continued)
Stock Option Activity

A summary of the Company's stock option activity and related information for the
three fiscal years ended September 27, 2008, is as follows (in thousands, except
per share amounts and contractual term in years):
Shares
Available
for Grant
Balance at
September 24, 2005
Restricted stock units
granted
Options granted
Options cancelled
cancelled
Options exercised
Plan shares expired
Balance at
September 30, 2006
Additional shares
authorized
granted
Options granted
Options cancelled
cancelled
Options exercised
Plan shares expired
Balance at
September 29, 2007
Number of
Shares
Weighted-Average
Exercise Price
58,957
73,221
17.79
(2,950)
(3,881)
2,325
3,881 $
(2,325) $
65.28
29.32
625
(82)
(21,795) $
-
11.78
-
54,994
52,982
28,000
(2,640)
(14,010)
1,471
20
(8)
67,827
23.23
-
14,010 $
(1,471) $
94.52
55.38
(15,770) $
-
18.32
-
49,751
43.91

granted
Options granted
Options cancelled
cancelled
Options exercised
Plan shares expired
Balance at
September 27, 2008
(9,834)
(9,359)
1,236
9,359 $
(1,236) $
171.36
98.40
714
(12)
(13,728) $
-
27.88
-
50,572
44,146
74.39
Exercisable at
September 27, 2008
24,751
40.93
Expected to Vest after

September 27, 2008
18,701
117.09
Outstanding Options
Weighted-Average
Remaining
Contractual Term
Aggregate
Intrinsic Value
4.29
2,377,262
3.42
2,161,010
5.40
208,517

APPLE INC
TABLE32
Form Type: 10-K
Number of
Shares
Weighted-Average
Grant Date
Aggregate
Fair Value
Intrinsic Value
$
14.21
$
70.92
$
13.37
$
12.75
Balance at September 24, 2005

Restricted stock units granted
Restricted stock units vested
Restricted stock units cancelled
5,030
1,475
(2,470)
(625)

3,410
1,320
(45)
(10)
$
$
$
$
39.62
88.51
46.57
86.14

4,675
4,917
(2,195)
(357)
$
$
$
$
52.98
162.61
25.63
119.12
7,040
134.91
902,749

APPLE INC
TABLE33
Form Type: 10-K
Expected life of stock options

Expected life of stock purchase rights
Interest rate-stock options
Interest rate-stock purchase rights
Volatility-stock options
Volatility-stock purchase rights
Dividend yields
Weighted-average fair value of stock
options granted during the year
Weighted-average fair value of employee
stock purchase plan rights during the year
2008
3.41 years
6 months
3.40%
3.48%
45.64%
38.51%
$
62.73
42.27
2007
3.46
6
years
months
4.61%
5.13%
38.13%
39.22%
-
2006
3.56 years
6 months
4.60%
4.29%
40.34%
39.56%
-
31.86
23.16
20.90
14.06

APPLE INC
TABLE34
Form Type: 10-K
Fiscal Years
2009 $
2010
2011
2012
2013
195
209
200
191
177
788
1,760
Thereafter
Total minimum lease payments

APPLE INC
TABLE35
Form Type: 10-K
Beginning accrued warranty and related costs

Cost of warranty claims
Accruals for product warranties
Ending accrued warranty and related costs
2008
230 $
(319)
356
267
2007
284
(281)
227
230
2006
188
(267)
363
284

APPLE INC
TABLE36
Form Type: 10-K
Note 9-Segment Information and Geographic Data (Continued)
Summary information by operating segment for the three fiscal years ended
September 27, 2008 is as follows (in millions):
2008
2007
Americas:
Net sales
Operating income
Depreciation, amortization, and accretion
Segment assets (a)
$
$
$9
$
14,573
4,051
Europe:
Net sales
Operating income
Segment assets
$
$
$6
$
7,622
2,313
$
$
$6
1,775 $
5,460
1,348
Japan:
Net sales
Operating income
Segment assets
$
$
$2
$
1,509
440
1,082
232
$
$
$
$
6,315
1,337
108
1,869
$
$
$4
$
2,460
615
Retail:
Net sales
Operating income
Depreciation, amortization, and accretion (b)
Segment assets (b)
Other Segments (c):
Net sales
Operating income
Segment assets
$
$
$9
3,039 $
$
$
$3
302 $
11,596
2,949
1,497
595
159
$
$
$
$
4,115
875
88
1,085
$
$
$3
534 $
1,753
388
252
2006
$
$
$6
$
9,415
1,899
$
$
$4
$
4,096
627
$
$
$3
$
1,211
208
$
$
$
$
3,246
600
59
651
$
$
$3
$
1,347
235
896
471
181
180

APPLE INC
TABLE37
Form Type: 10-K
A reconciliation of the Company's segment operating income and assets to the

Consolidated Financial Statements for the three fiscal years ended September 27,
2008 is as follows (in millions):
2008
8,756
(1,965)
(516)
Segment operating income

Other corporate expenses, net (a)
Stock-based compensation expense
Total operating income
6,275
Segment assets
Corporate assets
7,519
32,053
Consolidated assets
39,572
129
Segment depreciation, amortization, and

accretion
Corporate depreciation, amortization, and
accretion
Consolidated depreciation, amortization, and
accretion
344
473
ets to the
ember 27,
2007
5,792 $
(1,141)
(242)
2006
3,569
(953)
(163)
4,409
2,453
3,588
21,759
2,379
14,826
25,347
17,205
109
75
208
317
150
225

APPLE INC
TABLE38
Form Type: 10-K
2008
2007
2006
Net sales:
U.S.
International
18,469
14,010
14,128
9,878
11,486
7,829
Total net sales
32,479
24,006
19,315
Long-lived assets:
U.S.
International
2,269
410
1,752
260
1,150
218
Total long-lived assets
2,679
2,012
1,368

APPLE INC
TABLE39
Form Type: 10-K
Information regarding net sales by product for the three fiscal years ended
September 27, 2008, is as follows (in millions):
2008
Net sales:
Desktops (a)
Portables (b)
Total Mac net sales

iPod
Other music related products and services (c)
iPhone and related products and services (d)
Peripherals and other hardware (e)
Software, service, and other net sales (f)
Total net sales
5,603
8,673
2007
$
4,020
6,294
14,276
10,314
9,153
3,340
1,844
1,659
2,207
8,305
2,496
123
1,260
1,508
32,479
24,006
2006
$
3,319
4,056
7,375
7,676
1,885
1,100
1,279
19,315

APPLE INC
TABLE40
Form Type: 10-K
Note 11-Selected Quarterly Financial Information (Unaudited)
The following tables set forth a summary of the Company's quarterly financial
information for each of the four quarters ended September 27, 2008 and
September 29, 2007 (in millions, except per share amounts):
Fourth Quarter
2008
Net sales
Gross margin
Net income
Basic
Diluted
2007
Net sales
Gross margin
Net income
Basic
Diluted
Third Quarter
Second Quarter
$
$
$
7,895
2,739
1,136
$
$
$
7,464
2,600
1,072
$
$
$
7,512
2,474
1,045
$
$
1.28
1.26
$
$
1.21
1.19
$
$
1.19
1.16
$
$
$
6,217
2,090
904
$
$
$
5,410
1,995
818
$
$
$
5,264
1,849
770
$
$
1.04
1.01
$
$
0.94
0.92
$
$
0.89
0.87
First Quarter
$
$
$
9,608
3,332
1,581
$
$
1.81
1.76
$
$
$
7,115
2,220
1,004
$
$
1.17
1.14

APPLE INC
TABLE41
Form Type: 10-K
Incorporated by Referenc
Exhibit
Number
Exhibit Description
3.10 Restated Articles of Incorporation, filed with the
Secretary of State of the State of California on
January 27, 1988.
Form
S-3
3.20 Certificate of Amendment to Restated Articles of

Incorporation, filed with the Secretary of State of
the State of California on May 4, 2000.
10-Q
3.30 Certificate of Amendment to Restated Articles of

Incorporation, as amended, filed with the Secretary
of State of the State of California on February 25,
2005.
10-Q
3.40 Certificate of Determination of Preferences of Series

A Non-Voting Convertible Preferred Stock of the
Registrant.
10-K
3.50 By-Laws of the Registrant, as amended through August

20, 2008.
8-K
4.10 Form of Stock Certificate of the Registrant.
10-Q
10.1*
Employee Stock Purchase Plan, as amended through May

10, 2007.
8-K
10.2*
Form of Indemnification Agreement between the

Registrant and each officer of the Registrant.
10-K
10.3*
1997 Employee Stock Option Plan, as amended through

October 19, 2001.
10-K
10.4*
1997 Director Stock Option Plan, as amended through

May 10, 2007.
8-K
10.5*
2003 Employee Stock Plan, as amended through May 10,

2007.
8-K
10.6*
Reimbursement Agreement dated as of May 25, 2001 by

and between the Registrant and Steven P. Jobs.
10-Q
10.7*
Performance Bonus Plan dated April 21, 2005.
10-Q
10.8*
Form of Option Agreements.
10-K
10.9*
Form of Restricted Stock Unit Award Agreement

effective as of August 28, 2007.
10-K
14.10 Business Conduct Policy of the Registrant dated

January 2008.
10-Q
21**
Subsidiaries of the Registrant.
23.1**
Consent of Independent Registered Public Accounting

Firm.
24.1**
Power of Attorney (included on the Signature Page of

this Annual Report on Form 10-K).
31.1**
Rule 13a-14(a) / 15d-14(a) Certification of Chief

Executive Officer.
31.2**
Rule 13a-14(a) / 15d-14(a) Certification of Chief

Financial Officer.
32.1***
Section 1350 Certifications of Chief Executive

Officer and Chief Financial Officer.
Incorporated by Reference
Filing Date/
Period End Date
7/27/88
5/11/00
3/26/05
9/26/97
8/25/08
12/30/06
5/16/07
9/26/97
9/28/02
5/16/07
5/16/07
6/29/02
3/26/05
9/24/05
9/29/07
12/29/07

APPLE INC
SUBSIDIARIES
Form Type: 10-K
SUBSIDIARIES OF
APPLE INC.*
Name
Apple Sales International (formerly Apple Computer International)
Braeburn Capital, Inc.
Exhibit 21
Jurisdiction
of Incorporation
Ireland
Nevada, U.S.

2008 Apple 10k

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Created by EDGAR Online, Inc.

Registrant's telephone number, including area code: (408) 996-1010

Created by EDGAR Online, Inc.

Smaller Reporting Company

Created by EDGAR Online, Inc.

Position With the Company

Created by EDGAR Online, Inc.

elow represents the highest

Created by EDGAR Online, Inc.

Created by EDGAR Online, Inc.

Created by EDGAR Online, Inc.

Unit Sales by Operating Segment:

Total Mac unit sales

Net Sales by Product:

Total Mac net sales

Unit Sales by Product:

Total Mac unit sales

Net sales per Mac unit sold (h)

iPod unit sales

Created by EDGAR Online, Inc.

Gross margin percentage

Created by EDGAR Online, Inc.

Research and development

Created by EDGAR Online, Inc.

Total other income and expense

Created by EDGAR Online, Inc.

Cash, cash equivalents, and short-term investments

Created by EDGAR Online, Inc.

Created by EDGAR Online, Inc.

Total current assets

Total current liabilities

Commitments and contingencies

Total shareholders' equity

Total liabilities and shareholders'

September 29, 2007

Created by EDGAR Online, Inc.

Three fiscal years ended September 27, 2008

Total operating expenses

Income before provision for income taxes

Earnings per common share:

Shares used in computing earnings per share:

Created by EDGAR Online, Inc.

Created by EDGAR Online, Inc.

Change in unrealized gain on

Created by EDGAR Online, Inc.

Three fiscal years ended September 27, 2008

Proceeds from issuance of common stock

Cash generated by financing activities

Increase in cash and cash equivalents

Cash and cash equivalents, end of the year

Supplemental cash flow disclosures:

Created by EDGAR Online, Inc.

Denominator for diluted earnings per share

Basic earnings per share

Diluted earnings per share

Created by EDGAR Online, Inc.

Cash, Cash Equivalents and Short-Term Investments

Created by EDGAR Online, Inc.

Less than 12 Months

Less than 12 Months

Created by EDGAR Online, Inc.

Beginning allowance balance

Ending allowance balance

Created by EDGAR Online, Inc.