Apple Reports First Quarter Profit of US$38 Million

Apple today announced financial results for its fiscal 2002 first quarter ended December 29th, 2001. For the quarter, the Company posted a net profit of US$38 million (£26.5m*), or US$0.11 per diluted share. These results compare to a net loss of US$195 million, or US$0.58 per diluted share, in the year ago quarter. Revenues for the quarter were US$1.38 billion (£961.1m*), up 37 percent from the year ago quarter, and gross margins were 30.7 percent, compared to -2.1 percent in the year ago quarter. International sales accounted for 48 percent of the Quarter's revenues.

The quarter's results included a US$24 million (£16.7m*) restructuring charge related to targeted reductions in the Company's operations, information systems and administrative functions, and a US$23 million (£16m*) realised gain from equity investments. These non-recurring items had a net neutral impact on reported earnings per share.

Apple shipped 746,000 Macintosh units during the quarter.

“Apple delivered a solid quarter and is one of the few companies making aprofit in personal computers during these challenging times”, said SteveJobs, Apple's CEO. “During last quarter we continued our strategy ofinnovation. We launched the wildly popular iPod and sold more than 125,000of them in two months. And we ended the year with 27 Apple retail storesthat attracted over 800,000 visitors in the month of December alone”.

“We're pleased to have delivered healthy results while maintaining lean channel inventories in a very challenging environment”, said Fred Anderson, Apple's CFO. “Our balance sheet remains very strong, with almost $4.4 billion in cash. We are targeting March quarter revenues to be upsequentially to about $1.5 billion and EPS to be approximately flat with theDecember quarter”.

Consolidated Financial Statements and a Q1 FY 2002 Data Summary may bedownloaded from https://102.p.syniva.es/pr/library/2002/jan/16results.html.

Except for the historical information contained herein, the statements inthis press release are forward-looking statements that involve risks anduncertainties. Potential risks and uncertainties include, withoutlimitation, continued competitive pressures in the marketplace; the effectcompetitive and economic factors and the Company's reaction to them may have on consumer and business buying decisions with respect to the Company's products; the ability of the Company to make timely delivery of new programmes, products and successful technological innovations to themarketplace; the continued availability of certain components and servicesessential to the Company's business currently obtained by the Company fromsole or limited sources; possible disruption in commercial activities causedby terrorist activity and armed conflict, such as changes in logistics andsecurity arrangements,and reduced end-user purchases relative toexpectations; risks associated with the Company's retail initiativeincluding significant investment cost, uncertain consumer acceptance andpotential impact on existing reseller relationships; the effect that theCompany's dependency on manufacturing and logistics services provided bythird-parties may have on the quality or quantity of products manufactured;and the ability of the Company to successfully evolve its operating systemand attract sufficient Macintosh developers. More information on potentialfactors that could affect the Company's financial results is included fromtime to time in the Company's public reports filed with the SEC, includingthe Company's Form 10-K for the 2001 fiscal year, and the Company's Form 10-Q for the quarter ended December 29th, 2001, to be filed with the SEC.

* Figures based on exchange rates at the time of going to press; exchange rates are subject to fluctuation.

Press Contacts:
Apple UK and Ireland Public Relations
Email: [email protected]
Phone: (020) 8218 1440