Analysis of Property, Plant and Equipment
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- Statement of Comprehensive Income
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Property, Plant and Equipment Disclosure
Apple Inc., balance sheet: property, plant and equipment
US$ in millions
Based on: 10-K (reporting date: 2025-09-27), 10-K (reporting date: 2024-09-28), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-24), 10-K (reporting date: 2021-09-25), 10-K (reporting date: 2020-09-26).
The analysis of the annual property, plant, and equipment (PP&E) data reveals various trends that indicate changes in the company's investment and asset management over the observed periods.
- Land and buildings
- The value of land and buildings showed a consistent upward trend across all periods. Starting at approximately $17.95 billion, it increased steadily each year, reaching about $27.34 billion by the end of the latest period. This indicates ongoing investment or revaluation in fixed real estate assets.
- Machinery, equipment, and internal-use software
- This category showed a relatively moderate growth with some fluctuations. Beginning around $75.29 billion, it increased to around $81.06 billion by the third year, then experienced a slight decline to approximately $78.31 billion in the fourth year, followed by recovery and growth to about $83.42 billion by the final year. The fluctuation suggests periods of asset disposals or slower investment offset by renewals or additions.
- Leasehold improvements
- Leasehold improvements demonstrated a steady and consistent increase from roughly $10.28 billion to $15.09 billion over the stated periods. The growth reflects ongoing investments in leased properties, which might be related to expanding operational facilities or upgrading existing leased spaces.
- Gross property, plant, and equipment
- The total gross PP&E showed a consistent upward trajectory, starting from about $103.53 billion and rising to roughly $125.85 billion. This confirms an overall increase in the company’s investment in fixed assets, encompassing land, buildings, machinery, and leasehold improvements.
- Accumulated depreciation
- Accumulated depreciation values were negative, as is standard, and generally increased in absolute terms except for a minor decrease in the fourth year. It moved from approximately -$66.76 billion to around -$76.01 billion by the last period. The slight drop in the fourth year may indicate asset disposals or changes in depreciation methods but overall reflects aging assets and the ongoing recognition of depreciation expense.
- Property, plant, and equipment, net
- The net PP&E, which represents the gross PP&E minus accumulated depreciation, showed a continual upward trend from approximately $36.77 billion to about $49.83 billion. This growth indicates that despite accumulating depreciation, the company’s capital expenditure in new assets has outpaced asset depreciation, leading to a stronger net asset base.
In summary, the company displays a pattern of steady investment in its property, plant, and equipment assets, with some fluctuations in machinery and equipment values. The net increase in asset values coupled with the growth in accumulated depreciation suggests ongoing asset renewal and expansion activities, contributing positively to the company’s productive capacity.
Asset Age Ratios (Summary)
Apple Inc., asset age ratios
Based on: 10-K (reporting date: 2025-09-27), 10-K (reporting date: 2024-09-28), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-24), 10-K (reporting date: 2021-09-25), 10-K (reporting date: 2020-09-26).
The analysis of the property, plant, and equipment data over the given periods reveals several notable trends concerning asset age and useful life estimations.
- Average Age Ratio
- The average age ratio shows a gradual decline from 64.49% in 2020 to 60.4% in 2025. This steady decrease suggests that the assets are relatively becoming newer in the context of their total useful life, indicating ongoing investments or replacements that keep the asset base comparatively younger.
- Estimated Total Useful Life
- The estimated total useful life of the assets increases consistently from 11 years in 2020 to 16 years in 2025. This upward trend implies improvements or adjustments in the expected longevity of the assets, possibly due to enhanced asset quality, better maintenance practices, or changes in asset composition.
- Estimated Age (Time Elapsed Since Purchase)
- The estimated age of the assets increases steadily from 7 years in 2020 to 10 years in 2025. This is consistent with the passage of time, reflecting the aging of existing assets, assuming no significant disposals or retirements.
- Estimated Remaining Life
- The estimated remaining life increases from 4 years in 2020 to 6 years in 2024 and 2025. Despite the assets aging over time, the remaining life is projected to grow, which aligns with the increasing total useful life estimates, suggesting revaluation or extension of asset life due to maintenance or upgrades.
Overall, the data illustrates a dynamic asset management approach characterized by extending asset useful lives while maintaining a relatively youthful asset base. This could point to strategic investments in durable assets and effective lifecycle management practices.
Average Age
Based on: 10-K (reporting date: 2025-09-27), 10-K (reporting date: 2024-09-28), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-24), 10-K (reporting date: 2021-09-25), 10-K (reporting date: 2020-09-26).
2025 Calculations
1 Average age = 100 × Accumulated depreciation ÷ Gross property, plant and equipment
= 100 × ÷ =
- Accumulated Depreciation
- The accumulated depreciation shows a steady increase over the analyzed periods. Starting at approximately $66.76 billion, it rises consistently each year, reaching around $76.01 billion by the end of the last period. This upward trend indicates ongoing usage and wear of the company's fixed assets, reflecting continued depreciation expense recognized in the financial statements.
- Gross Property, Plant and Equipment
- The gross value of property, plant, and equipment also exhibits an upward trend over the years. Beginning at about $103.53 billion, it grows steadily to approximately $125.85 billion by the final reported date. This increase suggests significant investments in fixed assets, which could be associated with expansion, upgrades, or capacity enhancements.
- Average Age Ratio
- The average age ratio of the property, plant, and equipment shows a gradual decline from 64.49% to 60.4% over the period under review. This downward movement implies that the asset base is becoming relatively newer, likely due to the addition of new assets or replacement of older assets. A decreasing average age ratio often reflects a modernization effort or increased capital expenditure on newer assets.
- Overall Insights
- The combined analysis of the increasing gross PPE and accumulated depreciation alongside the decreasing average age ratio suggests a balanced approach to asset management. The company appears to be actively investing in new fixed assets while continuing to depreciate older ones. The firm's asset base is expanding, and those assets are, on average, becoming newer, indicating possible strategic investments to maintain or enhance operational capacity and efficiency.
Estimated Total Useful Life
Based on: 10-K (reporting date: 2025-09-27), 10-K (reporting date: 2024-09-28), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-24), 10-K (reporting date: 2021-09-25), 10-K (reporting date: 2020-09-26).
2025 Calculations
1 Estimated total useful life = Gross property, plant and equipment ÷ Depreciation expense on property, plant and equipment
= ÷ =
- Gross Property, Plant and Equipment
- The gross property, plant, and equipment showed a consistent upward trend over the observed period. Starting at approximately $103.5 billion, it increased steadily each year, reaching about $125.8 billion by the end of the last period. This growth indicates ongoing investments and acquisitions in physical assets, reflecting expansion or modernization efforts.
- Depreciation Expense on Property, Plant, and Equipment
- The depreciation expense exhibited a declining trend throughout the years, decreasing from $9.7 billion initially to $8.0 billion in the latest period. This reduction in depreciation expense suggests changes in asset composition or improved cost management related to asset usage and aging. The decrease might also reflect longer useful lives assigned to assets.
- Estimated Total Useful Life
- The estimated useful life of the property, plant, and equipment has been extended progressively. Initially set at 11 years, it increased over the years to reach 16 years by the end of the period. This trend implies that the company anticipates its assets to last longer, which may explain part of the reduction in depreciation expenses on an annual basis.
- Overall Analysis
- The combination of increasing gross asset values alongside a decreasing depreciation expense and lengthening useful life indicates strategic capital investment and asset management. The company appears to be investing significantly in assets while optimizing their depreciation schedules. The extension in asset life estimates could reflect improvements in asset quality or a shift towards longer-lasting technologies. These factors together contribute to a stronger asset base with controlled depreciation costs over time.
Estimated Age, Time Elapsed since Purchase
Based on: 10-K (reporting date: 2025-09-27), 10-K (reporting date: 2024-09-28), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-24), 10-K (reporting date: 2021-09-25), 10-K (reporting date: 2020-09-26).
2025 Calculations
1 Time elapsed since purchase = Accumulated depreciation ÷ Depreciation expense on property, plant and equipment
= ÷ =
- Accumulated Depreciation
- Accumulated depreciation on property, plant, and equipment has shown a generally increasing trend over the analyzed periods. It rose from 66,760 million USD in 2020 to 76,014 million USD in 2025, indicating ongoing depreciation recognition on the asset base. A slight decrease in the growth rate is noted between 2022 and 2023 but the overall trajectory remains upward.
- Depreciation Expense
- The depreciation expense has gradually decreased over the years, moving from 9,700 million USD in 2020 down to 8,000 million USD in 2025. This consistent decline suggests either an aging asset base with fewer new assets being capitalized or changes in depreciation policies or estimates leading to lower annual expenses.
- Time Elapsed Since Purchase
- The average time elapsed since asset purchases has increased steadily from 7 years in 2020 and 2021 to 10 years by 2025. This indicates an aging property, plant, and equipment portfolio, which aligns with the observed reduction in depreciation expense as assets become fully or near fully depreciated.
- Overall Insights
- The data reflect a mature asset base with accumulated depreciation steadily increasing, while annual depreciation expense declines, consistent with older assets in use. The increasing average age of assets supports this interpretation. These trends highlight that significant recent capital expenditures on property, plant, and equipment are limited or depreciation methods have resulted in decreasing charges, affecting the expense recognition patterns.
Estimated Remaining Life
Based on: 10-K (reporting date: 2025-09-27), 10-K (reporting date: 2024-09-28), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-24), 10-K (reporting date: 2021-09-25), 10-K (reporting date: 2020-09-26).
2025 Calculations
1 Estimated remaining life = Property, plant and equipment, net ÷ Depreciation expense on property, plant and equipment
= ÷ =
- Property, Plant and Equipment, Net
- The net value of property, plant, and equipment has shown a consistent upward trend over the observed periods. Beginning at approximately $36.8 billion, it has increased each year, reaching nearly $49.8 billion by the last recorded period. This steady growth suggests ongoing investments or capital expenditures in fixed assets, reflecting expansion or modernization efforts.
- Depreciation Expense on Property, Plant and Equipment
- The depreciation expense has demonstrated a gradual decline over the same timeframe. Starting around $9.7 billion, the expense decreased incrementally to $8.0 billion by the final year. This reduction may indicate improvements in asset efficiency, changes in depreciation methods, or the acquisition of assets with longer useful lives.
- Estimated Remaining Life
- The estimated remaining life of the property, plant, and equipment has increased from 4 years at the beginning to 6 years in the latest periods. This increase aligns with the observed decrease in depreciation expenses and may reflect the acquisition of longer-lived assets or extensions of the useful life estimates for existing assets.
- Overall Analysis
- The combination of increasing net asset values, decreasing depreciation expenses, and lengthening estimated remaining life points to a strategic approach favoring asset longevity and capital investment. The data suggests the company is enhancing its asset base while managing depreciation in a manner potentially beneficial to financial reporting and asset utilization profiles.