Apple Reports Fourth Quarter Profit of $170 Million
CUPERTINO, CaliforniaOctober 18, 2000Apple® today announced financial results for its fiscal 2000 fourth quarter ending September 30, 2000. For the quarter, the Company posted a net profit of $170 million, or $.47 per diluted share. These results compare to a net profit of $111 million, or $.31 per diluted share, achieved in the year ago quarter. Revenues for the quarter were $1.87 billion, up 40 percent from the year ago quarter, and gross margins were 25.0 percent, down from 28.7 percent in the year ago quarter. International sales accounted for 44 percent of the quarters revenues.
The quarters results included a $62 million after-tax gain from the sale of 7.1 million shares of ARM Holdings plc., which contributed $.17 to earnings per diluted share. Excluding investment gains, the Companys net profit would have been $108 million, an increase of 20 percent from the year ago quarter, and earnings per diluted share would have been $.30, up 20 percent from the year ago quarter.
Apple shipped 1,122,000 units during the quarter including over 570,000 iMac systems.
We have identified several factors which we believe contributed to our sales shortfall last quarter, and we are taking strong steps to remedy them going forward, said Steve Jobs, Apples CEO. Our sell-through for September was way below plan, leaving us with an overhang of channel inventory. Rather than reducing it gradually over the next several quarters, we have decided to reduce it to a normal level by the end of this quarter. This will result in a second disappointing financial quarter, even though our sell-through sales should be moderately strong. Our plan is to be back on track for the January quarter, and we remain very excited about our products and programs for 2001.
In light of Septembers disappointing sales and higher-than-planned ending channel inventories, we are resetting our revenue estimates for the December quarter to about $1.6 billion and are targeting a slight profit, said Fred Anderson, Apples CFO. We are also resetting our revenue target for fiscal year 2001 to the $7.5 to $8 billion range and our target for EPS to the $1.10 to $1.25 range.
For the year, the Company generated revenues of $7.98 billion and net earnings of $786 million, or $2.18 per diluted share. These results compare to fiscal 1999 revenues of $6.1 billion and net earnings of $601 million, or $1.81 per diluted share.
Apple ignited the personal computer revolution in the 1970s with the Apple II and reinvented the personal computer in the 1980s with the Macintosh. Apple is committed to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through its innovative hardware, software and Internet offerings.
Apple will provide live streaming of its Q4 2000 financial results conference call utilizing QuickTime, Apples standards-based technology for live and on-demand audio and video streaming. The live webcast will begin at 2 p.m. PDT on Wednesday, October 18, at www.apple.com/quicktime/qtv/earningsq400/ and will also be available for replay. The QuickTime player is available free for Macintosh® and Windows users at www.apple.com/quicktime.The statements in the release regarding anticipated results during the December quarter and fiscal 2001 are forward looking statements. Among the factors that could cause actual results to differ are the following: continued competitive pressures in the marketplace; the effect competitive and economic factors and the Companys reaction to them may have on consumer and business buying decisions with respect to the Companys products; the Companys ability to reduce inventory in the distribution channel to levels commensurate with end-user demand; the ability of the Company to make timely delivery of new programs, products and successful technological innovations to the marketplace; the continued availability of certain components and services essential to the Companys business currently obtained by the Company from sole or limited sources; the ability of the Company to successfully evolve its operating system; and the rate of customer adoption of Mac® OS X. More information on potential factors that could affect the Companys financial results is included from time to time in the Companys public reports filed with the SEC, including the Companys Form 10-Q for the quarter ended July 1, 2000, and the Companys Form 10-K for the 2000 fiscal year to be filed with
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