Stock Analysis on Net
Stock Analysis on Net

Apple Inc. (NASDAQ:AAPL)

Common-Size Income Statement 

Apple Inc., common-size consolidated income statement

Microsoft Excel
12 months ended: Sep 28, 2024 Sep 30, 2023 Sep 24, 2022 Sep 25, 2021 Sep 26, 2020 Sep 28, 2019
Products 75.41 77.77 80.19 81.30 80.41 82.21
Services 24.59 22.23 19.81 18.70 19.59 17.79
Net sales 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Products -47.37 -49.38 -51.09 -52.56 -55.11 -55.73
Services -6.42 -6.48 -5.60 -5.66 -6.66 -6.45
Cost of sales -53.79% -55.87% -56.69% -58.22% -61.77% -62.18%
Gross margin 46.21% 44.13% 43.31% 41.78% 38.23% 37.82%
Research and development -8.02 -7.80 -6.66 -5.99 -6.83 -6.23
Selling, general and administrative -6.67 -6.50 -6.36 -6.01 -7.25 -7.01
Operating expenses -14.70% -14.31% -13.02% -12.00% -14.09% -13.25%
Operating income 31.51% 29.82% 30.29% 29.78% 24.15% 24.57%
Interest and dividend income 0.00 0.98 0.72 0.78 1.37 1.91
Interest expense 0.00 -1.03 -0.74 -0.72 -1.05 -1.37
Other income (expense), net 0.07 -0.10 -0.06 0.02 -0.03 0.16
Other income (expense), net 0.07% -0.15% -0.08% 0.07% 0.29% 0.69%
Income before provision for income taxes 31.58% 29.67% 30.20% 29.85% 24.44% 25.27%
Provision for income taxes -7.61 -4.37 -4.89 -3.97 -3.53 -4.03
Net income 23.97% 25.31% 25.31% 25.88% 20.91% 21.24%

Based on: 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), 10-K (reporting date: 2019-09-28).

The analysis of the annual financial data reveals several notable trends and patterns over the periods observed.

Sales Composition
The contribution of products to net sales shows a gradual decline, decreasing from 82.21% in 2019 to 75.41% in 2024. Conversely, services have steadily increased their share from 17.79% to 24.59% over the same time frame. This indicates a strategic shift towards expanding service offerings relative to product sales.
Cost of Sales
The cost of sales as a percentage of net sales has shown a consistent downward trend, improving from -62.18% in 2019 to -53.79% in 2024. Both products and services costs as a percentage of net sales are decreasing, reflecting enhanced operational efficiencies or cost controls.
Gross Margin
Gross margin has improved steadily from 37.82% in 2019 to 46.21% in 2024, aligning with the reduction in cost of sales. This improvement in gross margin suggests more effective management of production and service delivery costs, contributing positively to profitability.
Operating Expenses
Research and development expenses fluctuate, initially decreasing from -6.23% to -5.99% in 2021 but subsequently rising to -8.02% in 2024, indicating increased investment in innovation or product development recently. Selling, general and administrative expenses remain relatively stable, with a slight increase from -7.01% to -6.67%. Overall operating expenses show a mild increase from -13.25% in 2019 to -14.7% in 2024, reflecting increased spending particularly on R&D.
Operating Income
Operating income as a percentage of net sales has generally improved, rising from 24.57% in 2019 to 31.51% in 2024. Despite minor fluctuations, the upward trend signifies stronger core profitability and efficient expense management.
Interest and Other Income/Expenses
Interest and dividend income shows a declining trend, decreasing from 1.91% in 2019 to 0.98% in 2023, with no data reported for 2024. Interest expense follows a similar declining pattern from -1.37% to -1.03%. Net other income and expenses have minimal impact and fluctuate near zero, indicating limited effects on overall profitability.
Income Before Provision for Income Taxes
This metric closely follows operating income trends, rising from 25.27% in 2019 to 31.58% in 2024, confirming the strengthening profitability before tax considerations.
Provision for Income Taxes
The provision for income taxes shows some variability, initially decreasing from -4.03% in 2019 to -3.53% in 2020, then increasing to -7.61% in 2024. This increase in tax provision in the latest period could have implications for net income margins.
Net Income
Net income as a percentage of net sales displays an improvement from 21.24% in 2019 to a peak of 25.88% in 2021, followed by a slight decline to 23.97% in 2024. This indicates overall profitability growth, tempered slightly in the most recent year potentially due to increased tax expense.