PRESS RELEASE April 19, 2000

Apple Reports Second Quarter Profit of $233 Million

Revenues up 27 percent; Profits up 72 percent

CUPERTINO, California—April 19, 2000—Apple® today announced financial results for its fiscal 2000 second quarter ending April 1, 2000. For the quarter, the Company posted a net profit of $233 million, or $1.28 per diluted share. These results compare to a net profit of $135 million, or $.84 per diluted share, achieved in the year-ago quarter. Revenues for the quarter were $1.94 billion, up 27 percent from the year-ago quarter, and gross margins were 28.2 percent, up from 26.3 percent in the year-ago quarter. International sales accounted for 51 percent of the quarter's revenues.
The quarter's results included a $73 million after-tax gain from the sale of 1.5 million shares of ARM Holdings plc., which contributed $.40 to earnings per diluted share. Without non-recurring items, the Company's net profit was $160 million, an increase of 72 percent from the year-ago quarter and earnings per diluted share increased 47 percent from the year-ago quarter. Sales of 1,043,000 units drove year-over-year unit growth of 26 percent.
“We are thrilled with the quarter—especially the strong demand for our PowerMac G4s and new PowerBooks,” said Steve Jobs, Apple's CEO. “In addition, Apple continued to strengthen its leadership in desktop movies with iMovie for consumers and Final Cut Pro for professionals.”
“Strong demand for our professional products combined with superb operational efficiency resulted in very strong earnings,” said Fred Anderson, Apple's CFO. “Apple finished the quarter with $3.6 billion in cash and short-term investments.”
Apple also announced today that its Board of Directors has approved a two-for-one split of its common stock. Subject to shareholders approving an increase in authorized shares at Apple's annual meeting tomorrow, each shareholder of record at the close of business on May 19, 2000 will receive one additional share for every outstanding share held on the record date, and trading will begin on a split-adjusted basis on June 21, 2000.
Except for the historical information contained herein, the statements in this press release are forward-looking statements that involve risks and uncertainties. Potential risks and uncertainties include, without limitation, continued competitive pressures in the marketplace; the effect competitive and economic factors and the Company's reaction to them may have on consumer and business buying decisions with respect to the Company's products; the ability of the Company to make timely delivery of new products and successful technological innovations to the marketplace; the continued availability of certain components and services essential to the Company's business currently obtained by the Company from sole or limited sources and the ability of the Company to successfully evolve its operating system. More information on potential factors that could affect the Company's financial results is included from time to time in the Company's public reports filed with the SEC, including the Company's Form 10-K for the 1999 fiscal year, and the Company's Form 10-Q for the quarter ended April 1, 2000, to be filed with the SEC.
Press Contact:
Katie Cotton
(408) 974-7269
Investor Relations Contacts:
Nancy Paxton
(408) 974-5420

Joan Hoover
(408) 974-4570
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