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What changed in Apple Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Apple Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+165 added−161 removedSource: 10-K (2024-11-01) vs 10-K (2023-11-03)

Top changes in Apple Inc.'s 2024 10-K

165 paragraphs added · 161 removed · 136 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeIn support of this, the Company offers a wide variety of benefits for employees around the world and invests in tools and resources that are designed to support employees’ individual growth and development. Inclusion and Diversity The Company is committed to its vision to build and sustain a more inclusive workforce that is representative of the communities it serves.
Biggest changeInclusion and Diversity The Company is committed to its vision to build and sustain a more inclusive workforce that is representative of the communities it serves. The Company continues to work to increase diverse representation at every level, foster an inclusive culture, and support equitable pay and access to opportunity for all employees.
Apple Inc. | 2023 Form 10-K | 3 Business Seasonality and Product Introductions The Company has historically experienced higher net sales in its first quarter compared to other quarters in its fiscal year due in part to seasonal holiday demand. Additionally, new product and service introductions can significantly impact net sales, cost of sales and operating expenses.
Apple Inc. | 2024 Form 10-K | 3 Business Seasonality and Product Introductions The Company has historically experienced higher net sales in its first quarter compared to other quarters in its fiscal year due in part to seasonal holiday demand. Additionally, new product and service introductions can significantly impact net sales, cost of sales and operating expenses.
Apple Inc. | 2023 Form 10-K | 2 The Company’s ability to compete successfully depends heavily on ensuring the continuing and timely introduction of innovative new products, services and technologies to the marketplace. The Company designs and develops nearly the entire solution for its products, including the hardware, operating system, numerous software applications and related services.
Apple Inc. | 2024 Form 10-K | 2 The Company’s ability to compete successfully depends heavily on ensuring the continuing and timely introduction of innovative new products, services and technologies to the marketplace. The Company designs and develops nearly the entire solution for its products, including the hardware, operating system, numerous software applications and related services.
Apple Inc. | 2023 Form 10-K | 1 Services Advertising The Company’s advertising services include third-party licensing arrangements and the Company’s own advertising platforms. AppleCare The Company offers a portfolio of fee-based service and support products under the AppleCare ® brand.
Apple Inc. | 2024 Form 10-K | 1 Services Advertising The Company’s advertising services include third-party licensing arrangements and the Company’s own advertising platforms. AppleCare The Company offers a portfolio of fee-based service and support products under the AppleCare ® brand.
Intellectual Property The Company currently holds a broad collection of intellectual property rights relating to certain aspects of its hardware devices, accessories, software and services. This includes patents, designs, copyrights, trademarks and other forms of intellectual property rights in the U.S. and various foreign countries.
Intellectual Property The Company currently holds a broad collection of intellectual property rights relating to certain aspects of its hardware, accessories, software and services. This includes patents, designs, copyrights, trademarks, trade secrets and other forms of intellectual property rights in the U.S. and various foreign countries.
The iPhone line includes iPhone 15 Pro, iPhone 15, iPhone 14, iPhone 13 and iPhone SE ® . Mac Mac ® is the Company’s line of personal computers based on its macOS ® operating system.
The iPhone line includes iPhone 16 Pro, iPhone 16, iPhone 15, iPhone 14 and iPhone SE ® . Mac Mac ® is the Company’s line of personal computers based on its macOS ® operating system.
Such reports and other information filed by the Company with the SEC are available free of charge at investor.apple.com/investor-relations/sec-filings/default.aspx when such reports are available on the SEC’s website. The Company periodically provides certain information for investors on its corporate website, www.apple.com, and its investor relations website, investor.apple.com.
Securities and Exchange Commission (the “SEC”). Such reports and other information filed by the Company with the SEC are available free of charge at investor.apple.com/investor-relations/sec-filings/default.aspx when such reports are available on the SEC’s website. The Company periodically provides certain information for investors on its corporate website, www.apple.com, and its investor relations website, investor.apple.com.
The iPad line includes iPad Pro ® , iPad Air ® , iPad and iPad mini ® . Wearables, Home and Accessories Wearables includes smartwatches and wireless headphones. The Company’s line of smartwatches, based on its watchOS ® operating system, includes Apple Watch Ultra™ 2, Apple Watch ® Series 9 and Apple Watch SE ® .
The iPad line includes iPad Pro ® , iPad Air ® , iPad and iPad mini ® . Wearables, Home and Accessories Wearables includes smartwatches, wireless headphones and spatial computers. The Company’s line of smartwatches, based on its watchOS ® operating system, includes Apple Watch Ultra ® 2, Apple Watch ® Series 10 and Apple Watch SE ® .
Available Information The Company’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to reports filed pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are filed with the U.S. Securities and Exchange Commission (the “SEC”).
Apple Inc. | 2024 Form 10-K | 4 Available Information The Company’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to reports filed pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are filed with the U.S.
The Company’s line of wireless headphones includes AirPods ® , AirPods Pro ® , AirPods Max™ and Beats ® products. Home includes Apple TV ® , the Company’s media streaming and gaming device based on its tvOS ® operating system, and HomePod ® and HomePod mini ® , high-fidelity wireless smart speakers. Accessories includes Apple-branded and third-party accessories.
Home includes Apple TV ® , the Company’s media streaming and gaming device based on its tvOS ® operating system, and HomePod ® and HomePod mini ® , high-fidelity wireless smart speakers. Accessories includes Apple-branded and third-party accessories.
During 2023, the Company’s net sales through its direct and indirect distribution channels accounted for 37% and 63%, respectively, of total net sales.
During 2024, the Company’s net sales through its direct and indirect distribution channels accounted for 38% and 62%, respectively, of total net sales.
Further, the Company’s references to website URLs are intended to be inactive textual references only. Apple Inc. | 2023 Form 10-K | 4
Further, the Company’s references to website URLs are intended to be inactive textual references only.
The Company recognizes its people are most likely to thrive when they have the resources to meet their needs and the time and support to succeed in their professional and personal lives.
The Company recognizes its people are most likely to thrive when they have the resources to meet their needs and the time and support to succeed in their professional and personal lives. In support of this, the Company offers a wide variety of benefits for employees around the world, including health, wellness and time away.
The Company continues to work to increase diverse representation at every level, foster an inclusive culture, and support equitable pay and access to opportunity for all employees. Engagement The Company believes that open and honest communication among team members, managers and leaders helps create an open, collaborative work environment where everyone can contribute, grow and succeed.
Engagement The Company believes that open and honest communication among team members, managers and leaders helps create an open, collaborative work environment where everyone can contribute, grow and succeed.
Workplace Practices and Policies The Company is an equal opportunity employer committed to inclusion and diversity and to providing a workplace free of harassment or discrimination. Compensation and Benefits The Company believes that compensation should be competitive and equitable, and should enable employees to share in the Company’s success.
As of September 28, 2024, the Company had approximately 164,000 full-time equivalent employees. Compensation and Benefits The Company believes that compensation should be competitive and equitable, and should enable employees to share in the Company’s success.
Human Capital The Company believes it has a talented, motivated and dedicated team, and works to create an inclusive, safe and supportive environment for all of its team members. As of September 30, 2023, the Company had approximately 161,000 full-time equivalent employees.
Human Capital The Company believes that its people play an important role in its success, and strives to attract, develop and retain the best talent. The Company works to create an inclusive, safe and supportive environment for all of its team members, so that its people can do the best work of their lives.
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The Company’s line of wireless headphones includes AirPods ® , AirPods Pro ® , AirPods Max ® and Beats ® products. Apple Vision Pro™ is the Company’s first spatial computer based on its visionOS™ operating system.
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Growth and Development The Company invests in resources to help its people develop and achieve their career goals. The Company offers programs through Apple University on leadership, management and influence, as well as Apple culture and values.
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Team members can also take advantage of online classes for business, technical and personal development, as well as learning opportunities to support their well-being. Workplace Practices and Policies The Company is an equal opportunity employer committed to inclusion and diversity and to providing a workplace free of harassment or discrimination.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThis could reduce the volume of sales, and the commission that the Company earns on those sales, would decrease. If the rate of the commission that the Company retains on such sales is reduced, or if it is otherwise narrowed in scope or eliminated, the Company’s business, results of operations and financial condition could be materially adversely affected.
Biggest changeChanges to the Company’s products and services could materially adversely affect the Company’s business, results of operations and financial condition, including if such business changes result in reduced App Store or other sales, reductions in the rate of the commission that the Company retains on such sales, or if the rate of the commission is otherwise narrowed in scope or eliminated.
Responding to these environmental, social and governance considerations and implementation of these goals and initiatives involves risks and uncertainties, requires investments, and depends in part on third-party performance or data that is outside the Company’s control. The Company cannot guarantee that it will achieve its announced environmental, social and governance goals and initiatives.
Responding to these environmental, social and governance considerations and implementation of the Company’s announced goals and initiatives involves risks and uncertainties, requires investments, and depends in part on third-party performance or data that is outside the Company’s control. The Company cannot guarantee that it will achieve its announced environmental, social and governance goals and initiatives.
Any failure, or perceived failure, by the Company to achieve its goals, further its initiatives, adhere to its public statements, comply with federal, state or international environmental, social and governance laws and regulations, or meet evolving and varied stakeholder expectations and standards could result in legal and regulatory proceedings against the Company and materially adversely affect the Company’s business, reputation, results of operations, financial condition and stock price.
Any failure, or perceived failure, by the Company to achieve its goals, further its initiatives, adhere to its public statements, comply with federal, state and international environmental, social and governance laws and regulations, or meet evolving and varied stakeholder expectations and standards could result in legal and regulatory proceedings against the Company and materially adversely affect the Company’s business, reputation, results of operations, financial condition and stock price.
These attacks seek to compromise the confidentiality, integrity or availability of confidential information or disrupt normal business operations, and can, among other things, impair the Company’s ability to attract and retain customers for its products and services, impact the Company’s stock price, materially damage commercial relationships, and expose the Company to litigation or government investigations, which could result in penalties, fines or judgments against the Company.
These attacks seek to compromise the confidentiality, integrity or availability of confidential information or disrupt normal business operations, and can, among other things, impair the Company’s ability to attract and retain customers for its products and services, impact the Company’s stock price, materially damage commercial relationships, and expose the Company to litigation or government investigations, which can result in penalties, fines or judgments against the Company.
Following an interruption to its business, the Company can require substantial recovery time, experience significant expenditures to resume operations, and lose significant sales. Because the Company relies on single or limited sources for the supply and manufacture of many critical components, a business interruption affecting such sources would exacerbate any negative consequences to the Company.
Following any interruption to its business, the Company can require substantial recovery time, experience significant expenditures to resume operations, and lose significant sales. Because the Company relies on single or limited sources for the supply and manufacture of many critical components, a business interruption affecting such sources would exacerbate any negative consequences to the Company.
Any failure by the Company to comply with these public statements or with other federal, state or international privacy or data protection laws and regulations could result in inquiries or proceedings against the Company by governmental entities or others. In addition to reputational impacts, penalties could include ongoing audit requirements and significant legal liability.
Any failure by the Company to comply with these public statements or with federal, state or international privacy or data protection laws and regulations could result in inquiries or proceedings against the Company by governmental entities or others. In addition to reputational impacts, penalties could include ongoing audit requirements and significant legal liability.
The Company could also be subject to unexpected developments, such as lower-than-anticipated demand for the Company’s products or services, issues with new product or service introductions, information technology system failures or network disruptions, or failure of one of the Company’s logistics, components supply, or manufacturing partners.
The Company could also be subject to unexpected developments, such as lower-than-anticipated demand for the Company’s products or services, issues with new product or service introductions, information technology system failures or network disruptions, or failure of one of the Company’s logistics, supply or manufacturing partners.
New and changing laws and regulations can adversely affect the Company’s business by increasing the Company’s costs, limiting the Company’s ability to offer a product, service or feature to customers, imposing changes to the design of the Company’s products and services, impacting customer demand for the Company’s products and services, and requiring changes to the Company’s supply chain and its business.
New and changing laws and regulations can adversely affect the Company’s business by increasing the Company’s costs, limiting the Company’s ability to offer a product, service or feature to customers, imposing changes to the design of the Company’s products and services, impacting customer demand for the Company’s products and services, and requiring changes to the Company’s business or supply chain.
Quality problems can also adversely affect the experience for users of the Company’s products and services, and result in harm to the Company’s reputation, loss of competitive advantage, poor market acceptance, reduced demand for products and services, delay in new product and service introductions and lost sales.
Quality problems can adversely affect the experience for users of the Company’s products and services, and result in harm to the Company’s reputation, loss of competitive advantage, poor market acceptance, reduced demand for products and services, delay in new product and service introductions and lost sales.
As with all companies, these security measures may not be sufficient for all eventualities and may be vulnerable to hacking, ransomware attacks, employee error, malfeasance, system error, faulty password management or other irregularities.
As with all companies, these security measures may not be sufficient for all eventualities and are vulnerable to hacking, ransomware attacks, employee error, malfeasance, system error, faulty password management or other irregularities.
Future dividends are subject to declaration by the Company’s Board of Directors, and the Company’s share repurchase program does not obligate it to acquire any specific number of shares.
Future dividends are subject to declaration by the Company’s Board of Directors (the “Board”), and the Company’s share repurchase program does not obligate it to acquire any specific number of shares.
Changes to the Company’s business practices to comply with new laws and regulations or in connection with other legal proceedings could negatively impact the reputation of the Company’s products for privacy and security and otherwise adversely affect the experience for users of the Company’s products and services, and result in harm to the Company’s reputation, loss of competitive advantage, poor market acceptance, reduced demand for products and services, and lost sales.
Changes to the Company’s business practices to comply with new laws and regulations or in connection with other legal proceedings can negatively impact the reputation of the Company’s products for privacy and security and otherwise adversely affect the experience for users of the Company’s products and services, and result in harm to the Company’s reputation, loss of competitive advantage, poor market acceptance, reduced demand for products and services, and lost sales.
The Company’s gross margins are subject to volatility and downward pressure due to a variety of factors, including: continued industry-wide global product pricing pressures and product pricing actions that the Company may take in response to such pressures; increased competition; the Company’s ability to effectively stimulate demand for certain of its products and services; compressed product life cycles; supply shortages; potential increases in the cost of components, outside manufacturing services, and developing, acquiring and delivering content for the Company’s services; the Company’s ability to manage product quality and warranty costs effectively; shifts in the mix of products and services, or in the geographic, currency or channel mix, including to the extent that regulatory changes require the Company to modify its product and service offerings; fluctuations in foreign exchange rates; inflation and other macroeconomic pressures; and the introduction of new products or services, including new products or services with higher cost structures.
The Company’s gross margins are subject to volatility and downward pressure due to a variety of factors, including: continued industry-wide global product pricing pressures and product pricing actions that the Company may take in response to such pressures; increased competition; the Company’s ability to effectively stimulate demand for certain of its products and services; compressed product life cycles; supply shortages; potential increases in the cost of components, outside manufacturing services, and developing, acquiring and delivering content for the Company’s services; the Company’s ability to manage product quality and warranty costs effectively; shifts in the mix of products and services, or in the geographic, currency or channel mix, including to the extent that regulatory changes require the Company to modify its product and service offerings; fluctuations in foreign exchange rates; inflation and other macroeconomic pressures; and the introduction of new products or services, including new products or services with lower profit margins.
The success of new product and service introductions depends on a number of factors, including timely and successful development, market acceptance, the Company’s ability to manage the risks associated with new technologies and production ramp-up issues, the availability of application software for the Company’s products, the effective management of purchase commitments and inventory levels in line with anticipated product demand, the availability of products in appropriate quantities and at expected costs to meet anticipated demand, and the risk that new products and services may have quality or other defects or deficiencies.
The success of new product and service introductions depends on a number of factors, including timely and successful development, market acceptance, the Company’s ability to manage the risks associated with new technologies and production ramp-up issues, the availability of application software or other third-party support for the Company’s products and services, the effective management of purchase commitments and inventory levels in line with anticipated product demand, the availability of products in appropriate quantities and at expected costs to meet anticipated demand, and the risk that new products and services may have quality or other defects or deficiencies.
The Company devotes significant resources to network and data security, including through the use of encryption and other security measures intended to protect its systems and data.
The Company devotes significant resources to systems and data security, including through the use of encryption and other security measures intended to protect its systems and data.
Such events can make it difficult or impossible for the Company to manufacture and deliver products to its customers, create delays and inefficiencies in the Company’s supply and manufacturing chain, and result in slowdowns and outages to the Company’s service offerings, and negatively impact consumer spending and demand in affected areas.
Such events can make it difficult or impossible for the Company to manufacture and deliver products to its customers, create delays and inefficiencies in the Company’s supply and manufacturing chain, result in slowdowns and outages to the Company’s service offerings, increase the Company’s costs, and negatively impact consumer spending and demand in affected areas.
While these arrangements help ensure the supply of components and finished goods, if these outsourcing partners or suppliers experience severe financial problems or other disruptions in their business, such continued supply can be reduced or terminated, and the recoverability of manufacturing process equipment or prepayments can be negatively impacted.
While these arrangements help ensure the supply of components and finished goods, if these outsourcing partners or suppliers experience severe financial problems or other disruptions in their business, such continued supply can be disrupted or terminated, and the recoverability of manufacturing process equipment or prepayments can be negatively impacted.
Component suppliers may suffer from poor financial conditions, which can lead to business failure for the supplier or consolidation within a particular industry, further limiting the Company’s ability to obtain sufficient quantities of components on commercially reasonable terms or at all.
In addition, component suppliers may suffer from poor financial conditions, which can lead to business failure for the supplier or consolidation within a particular industry, further limiting the Company’s ability to obtain sufficient quantities of components on commercially reasonable terms, or at all.
Therefore, although the Company has not realized any significant losses on its cash, cash equivalents and marketable securities, future fluctuations in their value could result in significant losses and could have a material adverse impact on the Company’s results of operations and financial condition.
Although the Company has not realized significant losses on its cash, cash equivalents and marketable securities, future fluctuations in their value could result in significant losses and could have a material adverse impact on the Company’s results of operations and financial condition.
For example, the Company earns revenue from licensing arrangements with other companies to offer their search services on the Company’s platforms and applications, and certain of these arrangements are currently subject to government investigations and legal proceedings.
For example, the Company earns revenue from licensing arrangements with Google LLC and other companies to offer their search services on the Company’s platforms and applications, and certain of these arrangements are currently subject to government investigations and legal proceedings.
The plaintiffs in these actions frequently seek injunctions and substantial damages. Regardless of the merit of particular claims, defending against litigation or responding to government investigations can be expensive, time-consuming and disruptive to the Company’s operations. In recognition of these considerations, the Company may enter into agreements or other arrangements to settle litigation and resolve such challenges.
The plaintiffs in these actions frequently seek broad injunctive relief and substantial damages. Regardless of the merit of particular claims, defending against litigation or responding to government investigations can be expensive, time-consuming and disruptive to the Company’s operations. In recognition of these considerations, the Company may enter into agreements or other arrangements to settle litigation and resolve such challenges.
In addition, manufacturing or logistics in these locations or transit to final destinations can be disrupted for a variety of reasons, including natural and man-made disasters, information technology system failures, commercial disputes, armed conflict, economic, business, labor, environmental, public health or political issues, or international trade disputes.
In addition, manufacturing or logistics in these locations or transit to final destinations can be disrupted for a variety of reasons, including natural and man-made disasters, information technology system failures, commercial disputes, economic, business, labor, environmental, public health or political issues, trade and other international disputes, geopolitical tensions, or conflict.
While the Company maintains insurance coverage for certain types of claims, such insurance coverage may be insufficient to cover all losses or all types of claims that may arise.
While the Company maintains insurance coverage for certain types of losses, such insurance coverage may be insufficient to cover all losses that may arise.
For example, tensions between governments, including the U.S. and China, have in the past led to tariffs and other restrictions being imposed on the Company’s business. If disputes and conflicts further escalate in the future, actions by governments in response could be significantly more severe and restrictive and could materially adversely affect the Company’s business.
For example, tensions between governments, including the U.S. and China, have in the past led to tariffs and other restrictions affecting the Company’s business. If disputes and conflicts further escalate in the future, actions by governments in response could be significantly more severe and restrictive and could materially adversely affect the Company’s business.
In addition, the Company has made prepayments associated with long-term supply agreements to secure supply of inventory components. As of September 30, 2023, the Company’s vendor non-trade receivables and prepayments related to long-term supply agreements were concentrated among a few individual vendors located primarily in Asia.
In addition, the Company has made prepayments associated with long-term supply agreements to secure supply of inventory components. As of September 28, 2024, the Company’s vendor non-trade receivables and prepayments related to long-term supply agreements were concentrated among a few individual vendors located primarily in Asia.
For example, third parties can fraudulently induce the Company’s or its vendors’ employees or customers into disclosing usernames, passwords or other sensitive information, which can, in turn, be used for unauthorized access to the Company’s or its vendors’ systems and services.
For example, third parties can fraudulently induce the Company’s or its suppliers’ and other third parties’ employees or customers into disclosing usernames, passwords or other sensitive information, which can, in turn, be used for unauthorized access to the Company’s or such suppliers’ or third parties’ systems and services.
Changing the Company’s operations in accordance with new or changed restrictions on international trade can be expensive, time-consuming and disruptive to the Company’s operations. Such restrictions can be announced with little or no advance notice and the Company may not be able to effectively mitigate all adverse impacts from such measures.
Changing the Company’s business and supply chain in accordance with new or changed restrictions on international trade can be expensive, time-consuming and disruptive to the Company’s operations. Such restrictions can be announced with little or no advance notice, which can create uncertainty, and the Company may not be able to effectively mitigate all adverse impacts from such measures.
Apple Inc. | 2023 Form 10-K | 10 The Company has invested and will continue to invest in programs to enhance reseller sales, including staffing selected resellers’ stores with Company employees and contractors, and improving product placement displays. These programs can require a substantial investment while not assuring return or incremental sales.
The Company has invested and will continue to invest in programs to enhance reseller sales, including staffing selected resellers’ stores with Company employees and contractors, and improving product placement displays. These programs can require a substantial investment while not assuring return or incremental sales.
Apple Inc. | 2023 Form 10-K | 15 The Company is exposed to credit risk on its trade accounts receivable, vendor non-trade receivables and prepayments related to long-term supply agreements, and this risk is heightened during periods when economic conditions worsen. The Company distributes its products and certain of its services through third-party cellular network carriers, wholesalers, retailers and resellers.
The Company is exposed to credit risk on its trade accounts receivable, vendor non-trade receivables and prepayments related to long-term supply agreements, and this risk is heightened during periods when economic conditions worsen. The Company distributes its products and certain of its services through third-party cellular network carriers, wholesalers, retailers and resellers.
Further, such an outcome can result in significant compensatory, punitive or trebled monetary damages, disgorgement of revenue or profits, remedial corporate measures or injunctive relief against the Company, and has from time to time required, and can in the future require, the Company to change its business practices and limit the Company’s ability to offer certain products and services, all of which could materially adversely affect the Company’s business, reputation, results of operations and financial condition.
Further, such an outcome can result in significant monetary damages, disgorgement of revenue or profits, remedial corporate measures or injunctive relief against the Company, and has from time to time required, and can in the future require, the Company to change its business practices and limit the Company’s ability to develop, manufacture, use, import or offer for sale certain products and services, all of which could materially adversely affect the Company’s business, reputation, results of operations and financial condition.
Apple Inc. | 2023 Form 10-K | 8 The Company is exposed to the risk of write-downs on the value of its inventory and other assets, in addition to purchase commitment cancellation risk. The Company records a write-down for product and component inventories that have become obsolete or exceed anticipated demand, or for which cost exceeds net realizable value.
The Company is exposed to the risk of write-downs on the value of its inventory and other assets, in addition to purchase commitment cancellation risk. The Company records a write-down for product and component inventories that have become obsolete or exceed anticipated demand, or for which cost exceeds net realizable value.
There can be no assurance these investments will achieve expected returns, and the Company may not be able to develop and market new products and services successfully. Apple Inc. | 2023 Form 10-K | 6 The Company currently holds a significant number of patents, trademarks and copyrights and has registered, and applied to register, additional patents, trademarks and copyrights.
There can be no assurance these investments will achieve expected returns, and the Company may not be able to develop and market new products and services successfully. The Company currently holds a significant number of patents, trademarks and copyrights and has registered, and applied to register, additional patents, trademarks and copyrights.
Apple Inc. | 2023 Form 10-K | 13 The Company is also currently subject to antitrust investigations in various jurisdictions around the world, which can result in legal proceedings and claims against the Company that could, individually or in the aggregate, have a materially adverse impact on the Company’s business, results of operations and financial condition.
The Company is also currently subject to antitrust investigations and litigation in various jurisdictions around the world, which can result in legal proceedings and claims against the Company that could, individually or in the aggregate, have a materially adverse impact on the Company’s business, results of operations and financial condition.
Apple Inc. | 2023 Form 10-K | 14 Financial Risks The Company expects its quarterly net sales and results of operations to fluctuate. The Company’s profit margins vary across its products, services, geographic segments and distribution channels. For example, the gross margins on the Company’s products and services vary significantly and can change over time.
Financial Risks The Company expects its quarterly net sales and results of operations to fluctuate. The Company’s profit margins vary across its products, services, geographic segments and distribution channels. For example, the gross margins on the Company’s products and services vary significantly and can change over time.
The Company’s financial performance is subject to risks associated with changes in the value of the U.S. dollar relative to local currencies. The Company’s primary exposure to movements in foreign exchange rates relates to non–U.S. dollar–denominated sales, cost of sales and operating expenses worldwide.
Apple Inc. | 2024 Form 10-K | 15 The Company’s financial performance is subject to risks associated with changes in the value of the U.S. dollar relative to local currencies. The Company’s primary exposure to movements in foreign exchange rates relates to non–U.S. dollar–denominated sales, cost of sales and operating expenses worldwide.
Apple Inc. | 2023 Form 10-K | 11 Investment in new business strategies and acquisitions could disrupt the Company’s ongoing business, present risks not originally contemplated and materially adversely affect the Company’s business, reputation, results of operations and financial condition. The Company has invested, and in the future may invest, in new business strategies or acquisitions.
Investment in new business strategies and acquisitions could disrupt the Company’s ongoing business, present risks not originally contemplated and materially adversely affect the Company’s business, reputation, results of operations and financial condition. The Company has invested, and in the future may invest, in new business strategies or acquisitions.
The application of tax laws may be uncertain, require significant judgment and be subject to differing interpretations. The Company is also subject to the examination of its tax returns and other tax matters by the U.S. Internal Revenue Service and other tax authorities and governmental bodies.
The application of tax laws may be uncertain, require significant judgment and be subject to differing interpretations. Apple Inc. | 2024 Form 10-K | 16 The Company is also subject to the examination of its tax returns and other tax matters by the U.S. Internal Revenue Service and other tax authorities and governmental bodies.
The Company’s success depends largely on the talents and efforts of its team members, the continued service and availability of highly skilled employees, including key personnel, and the Company’s ability to nurture its distinctive and inclusive culture.
Apple Inc. | 2024 Form 10-K | 10 The Company’s success depends largely on the talents and efforts of its team members, the continued service and availability of highly skilled employees, including key personnel, and the Company’s ability to nurture its distinctive and inclusive culture.
Such incidents and other malicious attacks could materially adversely affect the Company’s business, reputation, results of operations and financial condition. The Company experiences malicious attacks and other attempts to gain unauthorized access to its systems on a regular basis.
Such incidents and other malicious attacks could materially adversely affect the Company’s business, reputation, results of operations and financial condition. Apple Inc. | 2024 Form 10-K | 11 The Company experiences malicious attacks and other attempts to gain unauthorized access to its systems on a regular basis.
The Company’s products and services may be affected from time to time by design and manufacturing defects that could materially adversely affect the Company’s business and result in harm to the Company’s reputation. The Company offers complex hardware and software products and services that can be affected by design and manufacturing defects.
Apple Inc. | 2024 Form 10-K | 8 The Company’s products and services may be affected from time to time by design and manufacturing defects that could materially adversely affect the Company’s business and result in harm to the Company’s reputation. The Company offers complex hardware and software products and services that can be affected by design and manufacturing defects.
Apple Inc. | 2023 Form 10-K | 7 The Company relies on single-source outsourcing partners in the U.S., Asia and Europe to supply and manufacture many components, and on outsourcing partners primarily located in Asia, for final assembly of substantially all of the Company’s hardware products.
The Company relies on single-source outsourcing partners in the U.S., Asia and Europe to supply and manufacture many components, and on outsourcing partners primarily located in Asia, for final assembly of substantially all of the Company’s hardware products.
Apple Inc. | 2023 Form 10-K | 5 The Company has a large, global business with sales outside the U.S. representing a majority of the Company’s total net sales, and the Company believes that it generally benefits from growth in international trade.
The Company has a large, global business with sales outside the U.S. representing a majority of the Company’s total net sales, and the Company believes that it generally benefits from growth in international trade.
There can be no assurance the Company’s business will not be materially adversely affected, individually or in the aggregate, by the outcomes of such investigations, litigation or changes to laws and regulations in the future.
Apple Inc. | 2024 Form 10-K | 14 There can be no assurance the Company’s business will not be materially adversely affected, individually or in the aggregate, by the outcomes of such investigations, litigation or changes to laws and regulations in the future.
In addition, such operations and facilities are subject to the risk of interruption by fire, power shortages, nuclear power plant accidents and other industrial accidents, terrorist attacks and other hostile acts, ransomware and other cybersecurity attacks, labor disputes, public health issues, including pandemics such as the COVID-19 pandemic, and other events beyond the Company’s control.
In addition, the Company’s and its suppliers’ operations and facilities are subject to the risk of interruption by fire, power shortages, nuclear power plant accidents and other industrial accidents, terrorist attacks and other hostile acts, ransomware and other cybersecurity attacks, labor disputes, public health issues and other events beyond the Company’s control.
Apple Inc. | 2023 Form 10-K | 9 The Company distributes third-party applications for its products through the App Store. For the vast majority of applications, developers keep all of the revenue they generate on the App Store. The Company retains a commission from sales of applications and sales of digital services or goods initiated within an application.
The Company distributes third-party applications for its products through the App Store. For the vast majority of applications, developers keep all of the revenue they generate on the App Store. Where applicable, the Company retains a commission from sales of applications and sales of digital services or goods initiated within an application.
If the Company fails to meet expectations related to future growth, profitability, dividends, share repurchases or other market expectations, the price of the Company’s stock may decline significantly, which could have a material adverse impact on investor confidence and employee retention. Item 1B. Unresolved Staff Comments None. Item 1C. Cybersecurity Not applicable. Apple Inc. | 2023 Form 10-K | 16
If the Company fails to meet expectations related to future growth, profitability, dividends, share repurchases or other market expectations, the price of the Company’s stock may decline significantly, which could have a material adverse impact on investor confidence and employee retention. Item 1B. Unresolved Staff Comments None.
Failure to obtain the right to use third-party intellectual property, or to use such intellectual property on commercially reasonable terms, can preclude the Company from selling certain products or services, or otherwise have a material adverse impact on the Company’s business, results of operations and financial condition. The Company’s future performance depends in part on support from third-party software developers.
Failure to obtain the right to use third-party intellectual property, or to use such intellectual property on commercially reasonable terms, can require the Company to modify certain products, services or features or preclude the Company from selling certain products or services, or otherwise have a material adverse impact on the Company’s business, results of operations and financial condition.
Legal and Regulatory Compliance Risks The Company’s business, results of operations and financial condition could be adversely impacted by unfavorable results of legal proceedings or government investigations.
Apple Inc. | 2024 Form 10-K | 12 Legal and Regulatory Compliance Risks The Company’s business, results of operations and financial condition could be adversely impacted by unfavorable results of legal proceedings or government investigations.
Political events, trade and other international disputes, war, terrorism, natural disasters, public health issues, industrial accidents and other business interruptions can harm or disrupt international commerce and the global economy, and could have a material adverse effect on the Company and its customers, suppliers, contract manufacturers, logistics providers, distributors, cellular network carriers and other channel partners.
Political events, trade and other international disputes, geopolitical tensions, conflict, terrorism, natural disasters, public health issues, industrial accidents and other business interruptions can have a material adverse effect on the Company and its customers, employees, suppliers, contract manufacturers, logistics providers, distributors, cellular network carriers and other channel partners.
In addition, attacks against the Company and its customers can escalate during periods of severe diplomatic or armed conflict.
In addition, attacks against the Company and its customers can escalate during periods of geopolitical tensions or conflict.
These and other impacts can materially adversely affect the Company’s business, results of operations, financial condition and stock price. The Company’s business can be impacted by political events, trade and other international disputes, war, terrorism, natural disasters, public health issues, industrial accidents and other business interruptions.
These and other impacts can materially adversely affect the Company’s business, results of operations, financial condition and stock price. Apple Inc. | 2024 Form 10-K | 5 The Company’s business can be impacted by political events, trade and other international disputes, geopolitical tensions, conflict, terrorism, natural disasters, public health issues, industrial accidents and other business interruptions.
Many components, including those that are available from multiple sources, are at times subject to industry-wide shortages and significant commodity pricing fluctuations that can materially adversely affect the Company’s business, results of operations and financial condition.
Because the Company currently obtains certain components from single or limited sources, the Company is subject to significant supply and pricing risks. Many components, including those that are available from multiple sources, are at times subject to industry-wide shortages and significant commodity pricing fluctuations that can materially adversely affect the Company’s business, results of operations and financial condition.
Although the Company has programs, policies and procedures in place that are designed to satisfy regulatory requirements, there can be no assurance that such policies and procedures will be effective in preventing a violation or a claim of a violation.
For example, the Company is subject to changing regulations relating to the export and import of its products. Although the Company has programs, policies and procedures in place that are designed to satisfy regulatory requirements, there can be no assurance that such policies and procedures will be effective in preventing a violation or a claim of a violation.
If third-party software applications and services cease to be developed and maintained for the Company’s products, customers may choose not to buy the Company’s products.
There can be no assurance third-party developers will continue to develop and maintain software applications and services for the Company’s products. If third-party software applications and services cease to be developed and maintained for the Company’s products, customers may choose not to buy the Company’s products.
If such investigations result in adverse findings against the Company, the Company could be exposed to significant fines and may be required to make changes to its App Store business, all of which could materially adversely affect the Company’s business, results of operations and financial condition.
If such investigations or litigation are resolved against the Company, the Company can be exposed to significant fines and may be required to make further changes to its business practices, all of which could materially adversely affect the Company’s business, reputation, results of operations and financial condition.
Changes or additions to the Company’s supply chain require considerable time and resources and involve significant risks and uncertainties. The Company has also outsourced much of its transportation and logistics management. While these arrangements can lower operating costs, they also reduce the Company’s direct control over production and distribution.
The Company has also outsourced much of its transportation and logistics management. While these arrangements can lower operating costs, they also reduce the Company’s direct control over production and distribution.
Regulatory changes and other actions that materially adversely affect the Company’s business may be announced with little or no advance notice and the Company may not be able to effectively mitigate all adverse impacts from such measures. For example, the Company is subject to changing regulations relating to the export and import of its products.
Apple Inc. | 2024 Form 10-K | 13 Regulatory changes and other actions that materially adversely affect the Company’s business may be announced with little or no advance notice and the Company may not be able to effectively mitigate all adverse impacts from such measures.
From time to time, the Company has made changes to its App Store, including actions taken in response to competition, market conditions and legal and regulatory requirements.
From time to time, the Company has made changes to its products and services, including taking actions in response to litigation, competition, market conditions and legal and regulatory requirements, and expects to make further business changes in the future.
The impact can be particularly significant if these restrictive measures apply to countries and regions where the Company derives a significant portion of its revenues and/or has significant supply chain operations. Restrictive measures can require the Company to take various actions, including changing suppliers, restructuring business relationships, and ceasing to offer third-party applications on its platforms.
The impact can be particularly significant if these restrictive measures apply to countries and regions where the Company derives a significant portion of its revenues and/or has significant supply chain operations.
Failure to do so can result in widespread technical and performance issues affecting the Company’s products and services. In addition, the Company can be exposed to product liability claims, recalls, product replacements or modifications, write-offs of inventory, property, plant and equipment or intangible assets, and significant warranty and other expenses, including litigation costs and regulatory fines.
Errors, bugs and vulnerabilities can be exploited by third parties, compromising the safety and security of a user’s device. In addition, the Company can be exposed to product liability claims, recalls, product replacements or modifications, write-offs of inventory, property, plant and equipment or intangible assets, and significant warranty and other expenses, including litigation costs and regulatory fines.
Substantially all of the Company’s manufacturing is performed in whole or in part by outsourcing partners located primarily in China mainland, India, Japan, South Korea, Taiwan and Vietnam.
Substantially all of the Company’s manufacturing is performed in whole or in part by outsourcing partners located primarily in China mainland, India, Japan, South Korea, Taiwan and Vietnam. Restrictions on international trade, such as tariffs and other controls on imports or exports of goods, technology or data, can materially adversely affect the Company’s business and supply chain.
As a result, from time to time the Company’s services have not performed as anticipated and may not meet customer expectations. There can be no assurance the Company will be able to detect and fix all issues and defects in the hardware, software and services it offers.
There can be no assurance the Company will be able to detect and fix all issues and defects in the hardware, software and services it offers. Failure to do so can result in widespread technical and performance issues affecting the Company’s products and services.
There can be no assurance the Company will successfully manage future introductions and transitions of products and services. The Company depends on component and product manufacturing and logistical services provided by outsourcing partners, many of which are located outside of the U.S.
Apple Inc. | 2024 Form 10-K | 7 The Company depends on component and product manufacturing and logistical services provided by outsourcing partners, many of which are located outside of the U.S.
While the Company maintains insurance coverage for certain types of losses, such insurance coverage may be insufficient to cover all losses that may arise. Global markets for the Company’s products and services are highly competitive and subject to rapid technological change, and the Company may be unable to compete effectively in these markets.
Apple Inc. | 2024 Form 10-K | 6 Global markets for the Company’s products and services are highly competitive and subject to rapid technological change, and the Company may be unable to compete effectively in these markets.
The Company believes decisions by customers to purchase its hardware products depend in part on the availability of third-party software applications and services. There can be no assurance third-party developers will continue to develop and maintain software applications and services for the Company’s products.
Apple Inc. | 2024 Form 10-K | 9 The Company’s future performance depends in part on support from third-party software developers. The Company believes decisions by customers to purchase its hardware products depend in part on the availability of third-party software applications and services.
For example, the Company is the subject of investigations in Europe and other jurisdictions relating to App Store terms and conditions.
For example, the Company is subject to civil antitrust lawsuits in the U.S. alleging monopolization or attempted monopolization in the markets for “performance smartphones” and “smartphones” generally in violation of U.S. antitrust laws. In addition, the Company is the subject of investigations in Europe and other jurisdictions relating to App Store terms and conditions.
New and changing laws and regulations can also create uncertainty about how such laws and regulations will be interpreted and applied. These risks and costs may increase as the Company’s products and services are introduced into specialized applications, including health and financial services.
New and changing laws and regulations can also create uncertainty about how such laws and regulations will be interpreted and applied.
Future operating results depend upon the Company’s ability to obtain components in sufficient quantities on commercially reasonable terms. Because the Company currently obtains certain components from single or limited sources, the Company is subject to significant supply and pricing risks.
Changes or additions to the Company’s supply chain require considerable time and resources and involve significant risks and uncertainties, including exposure to additional regulatory and operational risks. Future operating results depend upon the Company’s ability to obtain components in sufficient quantities on commercially reasonable terms.
Apple Inc. | 2023 Form 10-K | 12 The Company is subject to complex and changing laws and regulations worldwide, which exposes the Company to potential liabilities, increased costs and other adverse effects on the Company’s business.
While the Company maintains insurance coverage for certain types of claims, such insurance coverage may be insufficient to cover all losses or all types of claims that may arise. The Company is subject to complex and changing laws and regulations worldwide, which exposes the Company to potential liabilities, increased costs and other adverse effects on the Company’s business.
Global climate change is resulting in certain types of natural disasters, such as droughts, floods, hurricanes and wildfires, occurring more frequently or with more intense effects.
Many of the Company’s operations and facilities, as well as critical business operations of the Company’s suppliers and contract manufacturers, are in locations that are prone to earthquakes and other natural disasters. Global climate change is resulting in certain types of natural disasters and extreme weather occurring more frequently or with more intense effects.
Future changes could also affect what the Company charges developers for access to its platforms, how it manages distribution of apps outside of the App Store, and how and to what extent it allows developers to communicate with consumers inside the App Store regarding alternative purchasing mechanisms.
For example, in the U.S., the Company has implemented changes to how developers communicate with consumers within apps on the U.S. storefront of the iOS and iPadOS App Store regarding alternative purchasing mechanisms.
The Company is also subject to litigation and investigations relating to the App Store, which have resulted in changes to the Company’s business practices, and may in the future result in further changes. Changes have included how developers communicate with consumers outside the App Store regarding alternative purchasing mechanisms.
The Company expects to make further business changes in the future. For example, in the U.S. the Company has implemented changes to how developers communicate with consumers within apps on the U.S. storefront of the iOS and iPadOS App Store regarding alternative purchasing mechanisms.
Removed
Restrictions on international trade, such as tariffs and other controls on imports or exports of goods, technology or data, can materially adversely affect the Company’s operations and supply chain and limit the Company’s ability to offer and distribute its products and services to customers.
Added
Restrictive measures can increase the cost of the Company’s products and the components and raw materials that go into them, and can require the Company to take various actions, including changing suppliers, restructuring business relationships and operations, and ceasing to offer and distribute affected products, services and third-party applications to its customers.
Removed
Political uncertainty surrounding trade and other international disputes could also have a negative effect on consumer confidence and spending, which could adversely affect the Company’s business. Many of the Company’s operations and facilities, as well as critical business operations of the Company’s suppliers and contract manufacturers, are in locations that are prone to earthquakes and other natural disasters.
Added
For example, global supply chains can be highly concentrated and geopolitical tensions or conflict could result in significant disruptions.
Removed
The effects of global or regional economic conditions on the Company’s suppliers, described in “ The Company’s operations and performance depend significantly on global and regional economic conditions and adverse economic conditions can materially adversely affect the Company’s business, results of operations and financial condition, ” above, can also affect the Company’s ability to obtain components .
Added
New products, services and technologies may replace or supersede existing offerings and may produce lower revenues and lower profit margins, which can materially adversely impact the Company’s business, results of operations and financial condition. There can be no assurance the Company will successfully manage future introductions and transitions of products and services.
Removed
The Company expects to make further business changes in the future, including as a result of legislative initiatives impacting the App Store, such as the European Union (“EU”) Digital Markets Act, which the Company is required to comply with by March 2024.
Added
As a result, from time to time the Company’s services have not performed as anticipated and may not meet customer expectations. The introduction of new and complex technologies, such as artificial intelligence features, can increase these and other safety risks, including exposing users to harmful, inaccurate or other negative content and experiences.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties The Company’s headquarters is located in Cupertino, California. As of September 30, 2023, the Company owned or leased facilities and land for corporate functions, R&D, data centers, retail and other purposes at locations throughout the U.S. and in various places outside the U.S.
Biggest changeItem 2. Properties The Company’s headquarters is located in Cupertino, California. As of September 28, 2024, the Company owned or leased facilities and land for corporate functions, R&D, data centers, retail and other purposes at locations throughout the U.S. and in various places outside the U.S.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe injunction applies to apps on the U.S. storefront of the iOS and iPadOS App Store. On April 24, 2023, the U.S. Court of Appeals for the Ninth Circuit (the “Circuit Court”) affirmed the District Court’s ruling. On June 7, 2023, the Company and Epic filed petitions with the Circuit Court requesting further review of the decision.
Biggest changeThe injunction applies to apps on the U.S. storefront of the iOS and iPadOS App Store. On January 16, 2024, the Company implemented a plan to comply with the injunction and filed a statement of compliance with the California District Court.
The District Court found that certain provisions of the Company’s App Store Review Guidelines violate California’s unfair competition law and issued an injunction enjoining the Company from prohibiting developers from including in their apps external links that direct customers to purchasing mechanisms other than Apple in-app purchasing.
The California District Court found that certain provisions of the Company’s App Store Review Guidelines violate California’s unfair competition law and issued an injunction enjoining the Company from prohibiting developers from including in their apps external links that direct customers to purchasing mechanisms other than Apple in-app purchasing.
Other Legal Proceedings The Company is subject to other legal proceedings and claims that have not been fully resolved and that have arisen in the ordinary course of business. The Company settled certain matters during the fourth quarter of 2023 that did not individually or in the aggregate have a material impact on the Company’s financial condition or operating results.
Other Legal Proceedings The Company is subject to other legal proceedings and claims that have not been fully resolved and that have arisen in the ordinary course of business. The Company settled certain matters during the fourth quarter of 2024 that did not individually or in the aggregate have a material impact on the Company’s financial condition or operating results.
The outcome of litigation is inherently uncertain. If one or more legal matters were resolved against the Company in a reporting period for amounts above management’s expectations, the Company’s financial condition and operating results for that reporting period could be materially adversely affected. Item 4. Mine Safety Disclosures Not applicable. Apple Inc. | 2023 Form 10-K | 17 PART II
The outcome of litigation is inherently uncertain. If one or more legal matters were resolved against the Company in a reporting period for amounts above management’s expectations, the Company’s financial condition and operating results for that reporting period could be materially adversely affected. Item 4. Mine Safety Disclosures Not applicable. Apple Inc. | 2024 Form 10-K | 18 PART II
Item 3. Legal Proceedings Epic Games Epic Games, Inc. (“Epic”) filed a lawsuit in the U.S. District Court for the Northern District of California (the “District Court”) against the Company alleging violations of federal and state antitrust laws and California’s unfair competition law based upon the Company’s operation of its App Store.
District Court for the Northern District of California (the “California District Court”) against the Company alleging violations of federal and state antitrust laws and California’s unfair competition law based upon the Company’s operation of its App Store.
Removed
On September 10, 2021, the District Court ruled in favor of the Company with respect to nine out of the ten counts included in Epic’s claim.
Added
Item 3. Legal Proceedings Digital Markets Act Investigations On March 25, 2024, the Commission announced that it had opened two formal noncompliance investigations against the Company under the DMA.
Removed
On June 30, 2023, the Circuit Court denied both petitions. On July 17, 2023, the Circuit Court granted Apple’s motion to stay enforcement of the injunction pending appeal to the U.S. Supreme Court. If the U.S. Supreme Court denies Apple’s petition, the stay of the injunction will expire. Masimo Masimo Corporation and Cercacor Laboratories, Inc.
Added
The Commission’s investigations concern (1) Article 5(4) of the DMA, which relates to how developers may communicate and promote offers to end users for apps distributed through the App Store as well as how developers may conclude contracts with those end users; and (2) Article 6(3) of the DMA, which relates to default settings, uninstallation of apps, and a web browser choice screen on iOS.
Removed
(together, “Masimo”) filed a complaint before the U.S. International Trade Commission (the “ITC”) alleging infringement by the Company of five patents relating to the functionality of the blood oxygen feature in Apple Watch Series 6 and 7.
Added
On June 24, 2024, the Commission announced its preliminary findings in the Article 5(4) investigation alleging that the Company’s App Store rules are in breach of the DMA and announced that it had opened a third formal investigation against the Company regarding whether the Company’s new contractual requirements for third-party app developers and app marketplaces may violate the DMA.
Removed
In its complaint, Masimo sought a permanent exclusion order prohibiting importation to the United States of certain Apple Watch models that include blood oxygen sensing functionality.
Added
If the Commission makes a final determination that there has been a violation, it can issue a cease and desist order and may impose fines up to 10% of the Company’s annual worldwide net sales.
Removed
On October 26, 2023, the ITC entered a limited exclusion order (the “Order”) prohibiting importation and sales in the United States of Apple Watch models with blood oxygen sensing functionality, which includes Apple Watch Series 9 and Ultra 2.
Added
Although any decision by the Commission can be appealed to the General Court of the EU, the effectiveness of the Commission’s order would apply immediately while the appeal is pending, unless a stay of the order is granted.
Removed
The Order will not go into effect until the end of the administrative review period, which is currently expected to end on December 25, 2023. The Company intends to appeal the Order and seek a stay pending the appeal.
Added
The Company believes that it complies with the DMA and has continued to make changes to its compliance plan in response to feedback and engagement with the Commission. Department of Justice Lawsuit On March 21, 2024, the U.S. Department of Justice (the “DOJ”) and a number of state and district attorneys general filed a civil antitrust lawsuit in the U.S.
Added
District Court for the District of New Jersey against the Company alleging monopolization or attempted monopolization in the markets for “performance smartphones” and “smartphones” in violation of U.S. antitrust laws. The DOJ is seeking equitable relief to redress the alleged anticompetitive behavior.
Added
In addition, various civil litigation matters have been filed in state and federal courts in the U.S. alleging similar violations of U.S. antitrust laws and seeking monetary damages and other nonmonetary relief. The Company believes it has substantial defenses and intends to vigorously defend itself. Epic Games Epic Games, Inc. (“Epic”) filed a lawsuit in the U.S.
Added
A motion by Epic disputing the Company’s compliance plan and seeking to enforce the injunction, which the Company has opposed, is pending before the California District Court. On September 30, 2024, the Company filed a motion with the California District Court to narrow or vacate the injunction. The Company believes it has substantial defenses and intends to vigorously defend itself.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePurchases of Equity Securities by the Issuer and Affiliated Purchasers Share repurchase activity during the three months ended September 30, 2023 was as follows (in millions, except number of shares, which are reflected in thousands, and per-share amounts): Periods Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (1) July 2, 2023 to August 5, 2023: Open market and privately negotiated purchases 33,864 $ 191.62 33,864 August 6, 2023 to September 2, 2023: August 2023 ASRs 22,085 (2) (2) 22,085 (2) Open market and privately negotiated purchases 30,299 $ 178.99 30,299 September 3, 2023 to September 30, 2023: Open market and privately negotiated purchases 20,347 $ 176.31 20,347 Total 106,595 $ 74,069 (1) As of September 30, 2023, the Company was authorized by the Board of Directors to purchase up to $90 billion of the Company’s common stock under a share repurchase program announced on May 4, 2023, of which $15.9 billion had been utilized.
Biggest changePurchases of Equity Securities by the Issuer and Affiliated Purchasers Share repurchase activity during the three months ended September 28, 2024 was as follows (in millions, except number of shares, which are reflected in thousands, and per-share amounts): Periods Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (1) June 30, 2024 to August 3, 2024: Open market and privately negotiated purchases 35,697 $ 224.11 35,697 August 4, 2024 to August 31, 2024: Open market and privately negotiated purchases 42,910 $ 221.39 42,910 September 1, 2024 to September 28, 2024: Open market and privately negotiated purchases 33,653 $ 222.86 33,653 Total 112,260 $ 89,074 (1) As of September 28, 2024, the Company was authorized by the Board to purchase up to $110 billion of the Company’s common stock under a share repurchase program announced on May 2, 2024, of which $20.9 billion had been utilized.
Apple Inc. | 2023 Form 10-K | 18 Company Stock Performance The following graph shows a comparison of five-year cumulative total shareholder return, calculated on a dividend-reinvested basis, for the Company, the S&P 500 Index and the Dow Jones U.S. Technology Supersector Index.
Apple Inc. | 2024 Form 10-K | 19 Company Stock Performance The following graph shows a comparison of five-year cumulative total shareholder return, calculated on a dividend-reinvested basis, for the Company, the S&P 500 Index and the Dow Jones U.S. Technology Supersector Index.
The graph assumes $100 was invested in each of the Company’s common stock, the S&P 500 Index and the Dow Jones U.S. Technology Supersector Index as of the market close on September 28, 2018. Past stock price performance is not necessarily indicative of future stock price performance.
The graph assumes $100 was invested in each of the Company’s common stock, the S&P 500 Index and the Dow Jones U.S. Technology Supersector Index as of the market close on September 27, 2019. Past stock price performance is not necessarily indicative of future stock price performance.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The Company’s common stock is traded on The Nasdaq Stock Market LLC under the symbol AAPL. Holders As of October 20, 2023, there were 23,763 shareholders of record.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The Company’s common stock is traded on The Nasdaq Stock Market LLC under the symbol AAPL. Holders As of October 18, 2024, there were 23,301 shareholders of record.
During the fourth quarter of 2023, the Company also utilized the final $4.6 billion under its previous repurchase program, which was most recently authorized in April 2022. The programs do not obligate the Company to acquire a minimum amount of shares.
During the fourth quarter of 2024, the Company also utilized the final $4.1 billion under its previous repurchase program, which was authorized in May 2023. The programs do not obligate the Company to acquire a minimum amount of shares.
Under the programs, shares may be repurchased in privately negotiated or open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act. (2) In August 2023, the Company entered into new accelerated share repurchase agreements (“ASRs”).
Under the programs, shares may be repurchased in privately negotiated or open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act.
Technology Supersector Index $ 100 $ 105 $ 154 $ 227 $ 164 $ 226 Item 6. [Reserved] Apple Inc. | 2023 Form 10-K | 19
Technology Supersector Index $ 100 $ 146 $ 216 $ 156 $ 215 $ 322 Item 6. [Reserved] Apple Inc. | 2024 Form 10-K | 20
September 2018 September 2019 September 2020 September 2021 September 2022 September 2023 Apple Inc. $ 100 $ 98 $ 204 $ 269 $ 277 $ 317 S&P 500 Index $ 100 $ 104 $ 118 $ 161 $ 136 $ 160 Dow Jones U.S.
September 2019 September 2020 September 2021 September 2022 September 2023 September 2024 Apple Inc. $ 100 $ 207 $ 273 $ 281 $ 322 $ 430 S&P 500 Index $ 100 $ 113 $ 156 $ 131 $ 155 $ 210 Dow Jones U.S.
Removed
Under the terms of the ASRs, two financial institutions committed to deliver shares of the Company’s common stock during the purchase periods in exchange for up-front payments totaling $5.0 billion.
Removed
The total number of shares ultimately delivered under the ASRs, and therefore the average repurchase price paid per share, is determined based on the volume-weighted average price of the Company’s common stock during the ASRs’ purchase periods, which end in the first quarter of 2024.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeApple Inc. | 2023 Form 10-K | 23 Provision for Income Taxes Provision for income taxes, effective tax rate and statutory federal income tax rate for 2023, 2022 and 2021 were as follows (dollars in millions): 2023 2022 2021 Provision for income taxes $ 16,741 $ 19,300 $ 14,527 Effective tax rate 14.7 % 16.2 % 13.3 % Statutory federal income tax rate 21 % 21 % 21 % The Company’s effective tax rate for 2023 and 2022 was lower than the statutory federal income tax rate due primarily to a lower effective tax rate on foreign earnings, the impact of the U.S. federal R&D credit, and tax benefits from share-based compensation, partially offset by state income taxes.
Biggest changeApple Inc. | 2024 Form 10-K | 24 Provision for Income Taxes Provision for income taxes, effective tax rate and statutory federal income tax rate for 2024, 2023 and 2022 were as follows (dollars in millions): 2024 2023 2022 Provision for income taxes $ 29,749 $ 16,741 $ 19,300 Effective tax rate 24.1 % 14.7 % 16.2 % Statutory federal income tax rate 21 % 21 % 21 % The Company’s effective tax rate for 2024 was higher than the statutory federal income tax rate due primarily to a one-time income tax charge of $10.2 billion, net, related to the State Aid Decision (refer to Note 7, “Income Taxes” in the Notes to Consolidated Financial Statements in Part II, Item 8 of this Form 10-K) and state income taxes, partially offset by a lower effective tax rate on foreign earnings, the impact of the U.S. federal R&D credit, and tax benefits from share-based compensation.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with the consolidated financial statements and accompanying notes included in Part II, Item 8 of this Form 10-K. This Item generally discusses 2023 and 2022 items and year-to-year comparisons between 2023 and 2022.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with the consolidated financial statements and accompanying notes included in Part II, Item 8 of this Form 10-K. This Item generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
Although management believes the Company’s reserves are reasonable, no assurance can be given that the final outcome of these uncertainties will not be different from that which is reflected in the Company’s reserves. Reserves are adjusted considering changing facts and circumstances, such as the closing of a tax examination.
Although management believes the Company’s reserves are reasonable, no assurance can be given that the final outcome of these uncertainties will not be different from that reflected in the Company’s reserves. Reserves are adjusted considering changing facts and circumstances, such as the closing of a tax examination.
The Company records a liability when it is probable that a loss has been incurred and the amount is reasonably estimable, the determination of which requires significant judgment. Resolution of legal matters in a manner inconsistent with management’s expectations could have a material impact on the Company’s financial condition and operating results. Apple Inc. | 2023 Form 10-K | 25
The Company records a liability when it is probable that a loss has been incurred and the amount is reasonably estimable, the determination of which requires significant judgment. Resolution of legal matters in a manner inconsistent with management’s expectations could have a material impact on the Company’s financial condition and operating results. Apple Inc. | 2024 Form 10-K | 26
Discussions of 2021 items and year-to-year comparisons between 2022 and 2021 are not included, and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended September 24, 2022.
Discussions of 2022 items and year-to-year comparisons between 2023 and 2022 are not included, and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2023.
The Company also issues unsecured short-term promissory notes pursuant to a commercial paper program. As of September 30, 2023, the Company had $6.0 billion of commercial paper outstanding, all of which was payable within 12 months. Leases The Company has lease arrangements for certain equipment and facilities, including corporate, data center, manufacturing and retail space.
The Company also issues unsecured short-term promissory notes pursuant to a commercial paper program. As of September 28, 2024, the Company had $10.0 billion of commercial paper outstanding, all of which was payable within 12 months. Leases The Company has lease arrangements for certain equipment and facilities, including corporate, data center, manufacturing and retail space.
As of September 30, 2023, the Company had fixed lease payment obligations of $15.8 billion, with $2.0 billion payable within 12 months. Manufacturing Purchase Obligations The Company utilizes several outsourcing partners to manufacture subassemblies for the Company’s products and to perform final assembly and testing of finished products.
As of September 28, 2024, the Company had fixed lease payment obligations of $15.6 billion, with $2.0 billion payable within 12 months. Manufacturing Purchase Obligations The Company utilizes several outsourcing partners to manufacture subassemblies for the Company’s products and to perform final assembly and testing of finished products.
Liquidity and Capital Resources The Company believes its balances of cash, cash equivalents and unrestricted marketable securities, which totaled $148.3 billion as of September 30, 2023, along with cash generated by ongoing operations and continued access to debt markets, will be sufficient to satisfy its cash requirements and capital return program over the next 12 months and beyond.
Liquidity and Capital Resources The Company believes its balances of unrestricted cash, cash equivalents and marketable securities, which totaled $140.8 billion as of September 28, 2024, along with cash generated by ongoing operations and continued access to debt markets, will be sufficient to satisfy its cash requirements and capital return program over the next 12 months and beyond.
The evaluation of the Company’s uncertain tax positions involves significant judgment in the interpretation and application of GAAP and complex domestic and international tax laws, including the Act and matters related to the allocation of international taxation rights between countries.
The evaluation of the Company’s uncertain tax positions involves significant judgment in the interpretation and application of GAAP and complex domestic and international tax laws, including the TCJA and the allocation of international taxation rights between countries.
The Company’s material cash requirements include the following contractual obligations: Debt As of September 30, 2023, the Company had outstanding fixed-rate notes with varying maturities for an aggregate principal amount of $106.6 billion (collectively the “Notes”), with $9.9 billion payable within 12 months. Future interest payments associated with the Notes total $41.1 billion, with $2.9 billion payable within 12 months.
The Company’s material cash requirements include the following contractual obligations: Debt As of September 28, 2024, the Company had outstanding fixed-rate notes with varying maturities for an aggregate principal amount of $97.3 billion (collectively the “Notes”), with $10.9 billion payable within 12 months. Future interest payments associated with the Notes total $38.5 billion, with $2.6 billion payable within 12 months.
Other Purchase Obligations The Company’s other purchase obligations primarily consist of noncancelable obligations to acquire capital assets, including assets related to product manufacturing, and noncancelable obligations related to supplier arrangements, licensed intellectual property and content, and distribution rights. As of September 30, 2023, the Company had other purchase obligations of $21.9 billion, with $5.6 billion payable within 12 months.
Other Purchase Obligations The Company’s other purchase obligations primarily consist of noncancelable obligations to acquire capital assets, including assets related to product manufacturing, and noncancelable obligations related to supplier arrangements, licensed intellectual property and content, and distribution rights. As of September 28, 2024, the Company had other purchase obligations of $12.0 billion, with $4.1 billion payable within 12 months.
The Company also obtains individual components for its products from a wide variety of individual suppliers. As of September 30, 2023, the Company had manufacturing purchase obligations of $53.1 billion, with $52.9 billion payable within 12 months. The Company’s manufacturing purchase obligations are primarily noncancelable.
The Company also obtains individual components for its products from a wide variety of individual suppliers. As of September 28, 2024, the Company had manufacturing purchase obligations of $53.0 billion, with $52.9 billion payable within 12 months.
Deemed Repatriation Tax Payable As of September 30, 2023, the balance of the deemed repatriation tax payable imposed by the U.S. Tax Cuts and Jobs Act of 2017 (the “Act”) was $22.0 billion, with $6.5 billion expected to be paid within 12 months.
Deemed Repatriation Tax Payable As of September 28, 2024, the balance of the deemed repatriation tax payable imposed by the U.S. Tax Cuts and Jobs Act of 2017 (the “TCJA”) was $16.5 billion, with $7.2 billion expected to be paid within 12 months.
Operating Expenses Operating expenses for 2023, 2022 and 2021 were as follows (dollars in millions): 2023 Change 2022 Change 2021 Research and development $ 29,915 14 % $ 26,251 20 % $ 21,914 Percentage of total net sales 8 % 7 % 6 % Selling, general and administrative $ 24,932 (1) % $ 25,094 14 % $ 21,973 Percentage of total net sales 7 % 6 % 6 % Total operating expenses $ 54,847 7 % $ 51,345 17 % $ 43,887 Percentage of total net sales 14 % 13 % 12 % Research and Development The year-over-year growth in R&D expense in 2023 was driven primarily by increases in headcount-related expenses.
Operating Expenses Operating expenses for 2024, 2023 and 2022 were as follows (dollars in millions): 2024 Change 2023 Change 2022 Research and development $ 31,370 5 % $ 29,915 14 % $ 26,251 Percentage of total net sales 8 % 8 % 7 % Selling, general and administrative $ 26,097 5 % $ 24,932 (1) % $ 25,094 Percentage of total net sales 7 % 7 % 6 % Total operating expenses $ 57,467 5 % $ 54,847 7 % $ 51,345 Percentage of total net sales 15 % 14 % 13 % Research and Development The growth in R&D expense during 2024 compared to 2023 was driven primarily by increases in headcount-related expenses.
Rest of Asia Pacific Rest of Asia Pacific net sales increased 1% or $240 million during 2023 compared to 2022. The weakness in foreign currencies relative to the U.S. dollar had a significantly unfavorable year-over-year impact on Rest of Asia Pacific net sales.
The weakness in foreign currencies relative to the U.S. dollar had a net unfavorable year-over-year impact on Rest of Asia Pacific net sales during 2024.
Apple Inc. | 2023 Form 10-K | 22 Gross Margin Products and Services gross margin and gross margin percentage for 2023, 2022 and 2021 were as follows (dollars in millions): 2023 2022 2021 Gross margin: Products $ 108,803 $ 114,728 $ 105,126 Services 60,345 56,054 47,710 Total gross margin $ 169,148 $ 170,782 $ 152,836 Gross margin percentage: Products 36.5 % 36.3 % 35.3 % Services 70.8 % 71.7 % 69.7 % Total gross margin percentage 44.1 % 43.3 % 41.8 % Products Gross Margin Products gross margin decreased during 2023 compared to 2022 due to the weakness in foreign currencies relative to the U.S. dollar and lower Products volume, partially offset by cost savings and a different Products mix.
Apple Inc. | 2024 Form 10-K | 23 Gross Margin Products and Services gross margin and gross margin percentage for 2024, 2023 and 2022 were as follows (dollars in millions): 2024 2023 2022 Gross margin: Products $ 109,633 $ 108,803 $ 114,728 Services 71,050 60,345 56,054 Total gross margin $ 180,683 $ 169,148 $ 170,782 Gross margin percentage: Products 37.2 % 36.5 % 36.3 % Services 73.9 % 70.8 % 71.7 % Total gross margin percentage 46.2 % 44.1 % 43.3 % Products Gross Margin Products gross margin and Products gross margin percentage increased during 2024 compared to 2023 due to cost savings, partially offset by a different Products mix and the weakness in foreign currencies relative to the U.S. dollar.
Fiscal Period The Company’s fiscal year is the 52- or 53-week period that ends on the last Saturday of September. An additional week is included in the first fiscal quarter every five or six years to realign the Company’s fiscal quarters with calendar quarters, which occurred in the first quarter of 2023.
An additional week is included in the first fiscal quarter every five or six years to realign the Company’s fiscal quarters with calendar quarters, which occurred in the first quarter of 2023. The Company’s fiscal years 2024 and 2022 spanned 52 weeks each, whereas fiscal year 2023 spanned 53 weeks.
Apple Inc. | 2023 Form 10-K | 20 Segment Operating Performance The following table shows net sales by reportable segment for 2023, 2022 and 2021 (dollars in millions): 2023 Change 2022 Change 2021 Net sales by reportable segment: Americas $ 162,560 (4) % $ 169,658 11 % $ 153,306 Europe 94,294 (1) % 95,118 7 % 89,307 Greater China 72,559 (2) % 74,200 9 % 68,366 Japan 24,257 (7) % 25,977 (9) % 28,482 Rest of Asia Pacific 29,615 1 % 29,375 11 % 26,356 Total net sales $ 383,285 (3) % $ 394,328 8 % $ 365,817 Americas Americas net sales decreased 4% or $7.1 billion during 2023 compared to 2022 due to lower net sales of iPhone and Mac, partially offset by higher net sales of Services.
Apple Inc. | 2024 Form 10-K | 21 Segment Operating Performance The following table shows net sales by reportable segment for 2024, 2023 and 2022 (dollars in millions): 2024 Change 2023 Change 2022 Americas $ 167,045 3 % $ 162,560 (4) % $ 169,658 Europe 101,328 7 % 94,294 (1) % 95,118 Greater China 66,952 (8) % 72,559 (2) % 74,200 Japan 25,052 3 % 24,257 (7) % 25,977 Rest of Asia Pacific 30,658 4 % 29,615 1 % 29,375 Total net sales $ 391,035 2 % $ 383,285 (3) % $ 394,328 Americas Americas net sales increased during 2024 compared to 2023 due primarily to higher net sales of Services.
During 2023, the Company repurchased $76.6 billion of its common stock and paid dividends and dividend equivalents of $15.0 billion. Macroeconomic Conditions Macroeconomic conditions, including inflation, changes in interest rates, and currency fluctuations, have directly and indirectly impacted, and could in the future materially impact, the Company’s results of operations and financial condition.
Macroeconomic Conditions Macroeconomic conditions, including inflation, interest rates and currency fluctuations, have directly and indirectly impacted, and could in the future materially impact, the Company’s results of operations and financial condition.
Apple Inc. | 2023 Form 10-K | 21 Products and Services Performance The following table shows net sales by category for 2023, 2022 and 2021 (dollars in millions): 2023 Change 2022 Change 2021 Net sales by category: iPhone (1) $ 200,583 (2) % $ 205,489 7 % $ 191,973 Mac (1) 29,357 (27) % 40,177 14 % 35,190 iPad (1) 28,300 (3) % 29,292 (8) % 31,862 Wearables, Home and Accessories (1) 39,845 (3) % 41,241 7 % 38,367 Services (2) 85,200 9 % 78,129 14 % 68,425 Total net sales $ 383,285 (3) % $ 394,328 8 % $ 365,817 (1) Products net sales include amortization of the deferred value of unspecified software upgrade rights, which are bundled in the sales price of the respective product.
Apple Inc. | 2024 Form 10-K | 22 Products and Services Performance The following table shows net sales by category for 2024, 2023 and 2022 (dollars in millions): 2024 Change 2023 Change 2022 iPhone $ 201,183 — % $ 200,583 (2) % $ 205,489 Mac 29,984 2 % 29,357 (27) % 40,177 iPad 26,694 (6) % 28,300 (3) % 29,292 Wearables, Home and Accessories 37,005 (7) % 39,845 (3) % 41,241 Services (1) 96,169 13 % 85,200 9 % 78,129 Total net sales $ 391,035 2 % $ 383,285 (3) % $ 394,328 (1) Services net sales include amortization of the deferred value of services bundled in the sales price of certain products. iPhone iPhone net sales were relatively flat during 2024 compared to 2023.
The Company intends to increase its dividend on an annual basis, subject to declaration by the Board of Directors.
As of September 28, 2024, the Company’s quarterly cash dividend was $0.25 per share. The Company intends to increase its dividend on an annual basis, subject to declaration by the Board.
Fourth Quarter 2023: • iPhone 15, iPhone 15 Plus, iPhone 15 Pro and iPhone 15 Pro Max; and • Apple Watch Series 9 and Apple Watch Ultra 2. In May 2023, the Company announced a new share repurchase program of up to $90 billion and raised its quarterly dividend from $0.23 to $0.24 per share beginning in May 2023.
In May 2024, the Company announced a new share repurchase program of up to $110 billion and raised its quarterly dividend from $0.24 to $0.25 per share beginning in May 2024. During 2024, the Company repurchased $95.0 billion of its common stock and paid dividends and dividend equivalents of $15.2 billion.
Apple Inc. | 2023 Form 10-K | 24 Capital Return Program In addition to its contractual cash requirements, the Company has an authorized share repurchase program. The program does not obligate the Company to acquire a minimum amount of shares. As of September 30, 2023, the Company’s quarterly cash dividend was $0.24 per share.
The funds necessary to settle the obligation were held in escrow as of September 28, 2024, and restricted from general use. Capital Return Program In addition to its contractual cash requirements, the Company has an authorized share repurchase program. The program does not obligate the Company to acquire a minimum amount of shares.
Mac Mac net sales decreased 27% or $10.8 billion during 2023 compared to 2022 due primarily to lower net sales of laptops. iPad iPad net sales decreased 3% or $1.0 billion during 2023 compared to 2022 due primarily to lower net sales of iPad mini and iPad Air, partially offset by the combined net sales of iPad 9th and 10th generation.
Mac Mac net sales increased during 2024 compared to 2023 due primarily to higher net sales of laptops. iPad iPad net sales decreased during 2024 compared to 2023 due primarily to lower net sales of iPad Pro and the entry-level iPad models, partially offset by higher net sales of iPad Air.
Wearables, Home and Accessories Wearables, Home and Accessories net sales decreased 3% or $1.4 billion during 2023 compared to 2022 due primarily to lower net sales of Wearables and Accessories. Services Services net sales increased 9% or $7.1 billion during 2023 compared to 2022 due to higher net sales across all lines of business.
Wearables, Home and Accessories Wearables, Home and Accessories net sales decreased during 2024 compared to 2023 due primarily to lower net sales of Wearables and Accessories. Services Services net sales increased during 2024 compared to 2023 due primarily to higher net sales from advertising, the App Store ® and cloud services.
The Company’s effective tax rate for 2023 was lower compared to 2022 due primarily to a lower effective tax rate on foreign earnings and the impact of U.S. foreign tax credit regulations issued by the U.S. Department of the Treasury in 2022, partially offset by lower tax benefits from share-based compensation.
The Company’s effective tax rate for 2024 was higher compared to 2023 due primarily to a one-time income tax charge of $10.2 billion, net, related to the State Aid Decision, a higher effective tax rate on foreign earnings and lower tax benefits from share-based compensation.
Greater China Greater China net sales decreased 2% or $1.6 billion during 2023 compared to 2022. The weakness in the renminbi relative to the U.S. dollar accounted for more than the entire year-over-year decrease in Greater China net sales, which consisted primarily of lower net sales of Mac and iPhone.
The weakness in the renminbi relative to the U.S. dollar had an unfavorable year-over-year impact on Greater China net sales during 2024. Japan Japan net sales increased during 2024 compared to 2023 due primarily to higher net sales of iPhone.
Services Gross Margin Services gross margin increased during 2023 compared to 2022 due primarily to higher Services net sales, partially offset by the weakness in foreign currencies relative to the U.S. dollar and higher Services costs.
The weakness in the yen relative to the U.S. dollar had an unfavorable year-over-year impact on Japan net sales during 2024. Rest of Asia Pacific Rest of Asia Pacific net sales increased during 2024 compared to 2023 due primarily to higher net sales of Services.
Selling, General and Administrative Selling, general and administrative expense was relatively flat in 2023 compared to 2022.
Selling, General and Administrative Selling, general and administrative expense increased $1.2 billion during 2024 compared to 2023.
Services gross margin percentage decreased during 2023 compared to 2022 due to higher Services costs and the weakness in foreign currencies relative to the U.S. dollar, partially offset by a different Services mix.
Services Gross Margin Services gross margin increased during 2024 compared to 2023 due primarily to higher Services net sales. Services gross margin percentage increased during 2024 compared to 2023 due to a different Services mix.
Third Quarter 2023: • MacBook Air 15”, Mac Studio and Mac Pro; • Apple Vision Pro™, the Company’s first spatial computer featuring its new visionOS™, expected to be available in early calendar year 2024; and • iOS 17, macOS Sonoma, iPadOS 17, tvOS 17 and watchOS 10, updates to the Company’s operating systems.
Third Quarter 2024: • iPad Air; • iPad Pro; • iOS 18, macOS Sequoia, iPadOS 18, watchOS 11, visionOS 2 and tvOS 18, updates to the Company’s operating systems; and • Apple Intelligence™, a personal intelligence system that uses generative models.
Removed
The Company’s fiscal year 2023 spanned 53 weeks, whereas fiscal years 2022 and 2021 spanned 52 weeks each. Fiscal Year Highlights The Company’s total net sales were $383.3 billion and net income was $97.0 billion during 2023. The Company’s total net sales decreased 3% or $11.0 billion during 2023 compared to 2022.
Added
Product, Service and Software Announcements The Company announces new product, service and software offerings at various times during the year. Significant announcements during fiscal year 2024 included the following: First Quarter 2024: • MacBook Pro 14-in.; • MacBook Pro 16-in.; and • iMac. Second Quarter 2024: • MacBook Air 13-in.; and • MacBook Air 15-in.
Removed
The weakness in foreign currencies relative to the U.S. dollar accounted for more than the entire year-over-year decrease in total net sales, which consisted primarily of lower net sales of Mac and iPhone, partially offset by higher net sales of Services. The Company announces new product, service and software offerings at various times during the year.
Added
Fourth Quarter 2024: • iPhone 16, iPhone 16 Plus, iPhone 16 Pro and iPhone 16 Pro Max; • Apple Watch Series 10; and • AirPods 4. Fiscal Period The Company’s fiscal year is the 52- or 53-week period that ends on the last Saturday of September.
Removed
Significant announcements during fiscal year 2023 included the following: First Quarter 2023: • iPad and iPad Pro; • Next-generation Apple TV 4K; and • MLS Season Pass, a Major League Soccer subscription streaming service. Second Quarter 2023: • MacBook Pro 14”, MacBook Pro 16” and Mac mini; and • Second-generation HomePod.
Added
Europe Europe net sales increased during 2024 compared to 2023 due primarily to higher net sales of Services and iPhone. Greater China Greater China net sales decreased during 2024 compared to 2023 due primarily to lower net sales of iPhone and iPad.
Removed
Europe Europe net sales decreased 1% or $824 million during 2023 compared to 2022. The weakness in foreign currencies relative to the U.S. dollar accounted for more than the entire year-over-year decrease in Europe net sales, which consisted primarily of lower net sales of Mac and Wearables, Home and Accessories, partially offset by higher net sales of iPhone and Services.
Added
Apple Inc. | 2024 Form 10-K | 25 State Aid Decision Tax Payable As of September 28, 2024, the Company had an obligation to pay €14.2 billion or $15.8 billion to Ireland in connection with the State Aid Decision, all of which was expected to be paid within 12 months.
Removed
Japan Japan net sales decreased 7% or $1.7 billion during 2023 compared to 2022. The weakness in the yen relative to the U.S. dollar accounted for more than the entire year-over-year decrease in Japan net sales, which consisted primarily of lower net sales of iPhone, Wearables, Home and Accessories and Mac.
Added
Recent Accounting Pronouncements Income Taxes In December 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which will require the Company to disclose specified additional information in its income tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold.
Removed
The net sales increase consisted of higher net sales of iPhone and Services, partially offset by lower net sales of Mac and iPad.
Added
ASU 2023-09 will also require the Company to disaggregate its income taxes paid disclosure by federal, state and foreign taxes, with further disaggregation required for significant individual jurisdictions. The Company will adopt ASU 2023-09 in its fourth quarter of 2026 using a prospective transition method.
Removed
(2) Services net sales include amortization of the deferred value of services bundled in the sales price of certain products. iPhone iPhone net sales decreased 2% or $4.9 billion during 2023 compared to 2022 due to lower net sales of non-Pro iPhone models, partially offset by higher net sales of Pro iPhone models.
Added
Segment Reporting In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which will require the Company to disclose segment expenses that are significant and regularly provided to the Company’s chief operating decision maker (“CODM”).
Removed
Products gross margin percentage increased during 2023 compared to 2022 due to cost savings and a different Products mix, partially offset by the weakness in foreign currencies relative to the U.S. dollar and decreased leverage.
Added
In addition, ASU 2023-07 will require the Company to disclose the title and position of its CODM and how the CODM uses segment profit or loss information in assessing segment performance and deciding how to allocate resources. The Company will adopt ASU 2023-07 in its fourth quarter of 2025 using a retrospective transition method.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+0 added−0 removed6 unchanged
Biggest changeThe following table sets forth potential impacts on the Company’s investment portfolio and term debt, including the effects of any associated derivatives, that would result from a hypothetical increase in relevant interest rates as of September 30, 2023 and September 24, 2022 (dollars in millions): Interest Rate Sensitive Instrument Hypothetical Interest Rate Increase Potential Impact 2023 2022 Investment portfolio 100 basis points, all tenors Decline in fair value $ 3,089 $ 4,022 Term debt 100 basis points, all tenors Increase in annual interest expense $ 194 $ 201 Foreign Exchange Rate Risk The Company’s exposure to foreign exchange rate risk relates primarily to the Company being a net receiver of currencies other than the U.S. dollar.
Biggest changeThe following table sets forth potential impacts on the Company’s investment portfolio and term debt, including the effects of any associated derivatives, that would result from a hypothetical increase in relevant interest rates as of September 28, 2024 and September 30, 2023 (dollars in millions): Interest Rate Sensitive Instrument Hypothetical Interest Rate Increase Potential Impact 2024 2023 Investment portfolio 100 basis points, all tenors Decline in fair value $ 2,755 $ 3,089 Term debt 100 basis points, all tenors Increase in annual interest expense $ 139 $ 194 Foreign Exchange Rate Risk The Company’s exposure to foreign exchange rate risk relates primarily to the Company being a net receiver of currencies other than the U.S. dollar.
Changes in the Company’s underlying foreign currency exposures, which were excluded from the assessment, generally offset changes in the fair values of the Company’s foreign currency derivatives. Apple Inc. | 2023 Form 10-K | 26
Changes in the Company’s underlying foreign currency exposures, which were excluded from the assessment, generally offset changes in the fair values of the Company’s foreign currency derivatives. Apple Inc. | 2024 Form 10-K | 27
Based on the results of the model, the Company estimates, with 95% confidence, a maximum one-day loss in fair value of $669 million and $1.0 billion as of September 30, 2023 and September 24, 2022, respectively.
Based on the results of the model, the Company estimates, with 95% confidence, a maximum one-day loss in fair value of $538 million and $669 million as of September 28, 2024 and September 30, 2023, respectively.

Other AAPL 10-K year-over-year comparisons