Apple Inc.
AAPL10-Q,quarter ended Mar 29, 2025,filed May 2, 2025,Original on SEC.gov (opens in a new tab)
3 of 3 checkable figures match the filing, 4 of 4 risk excerpts located in the filing text
Coverage details
This summary passed the automatic coverage checks when it was generated.
Coverage does not verify every claim. Check the cited sources and the original filing.
The Print
Apple reported Q2 2025 net income of $24.78B ($1.65 diluted EPS) on total net sales of $95.36B, up 5.1% from $90.75B a year earlier.
Total net sales increased 5.1% YoY to $95.36B from $90.75B, and net income rose to $24.78B from $23.64B. Management attributed the Americas increase primarily to higher net sales of iPhone and Services, the Japan increase primarily to higher net sales of iPhone and Services, and the Rest of Asia Pacific increase primarily to higher net sales of Services and iPhone; it attributed the Greater China decrease to lower net sales of iPhone. Services net sales increased due primarily to higher net sales from advertising, the App Store and cloud services.
- Total net sales rose 5.1% YoY to $95.36B, with Services up 11.6% to $26.65B and Products up 2.7% to $68.71B.
- Diluted EPS of $1.65 compared with $1.53 a year earlier, while weighted-average diluted shares fell to 15,056,133 thousand from 15,464,709 thousand.
- Gross margin was $44.87B (47.1% of net sales) versus $42.27B (46.6%) in the prior-year quarter.
- Greater China net sales declined 2.3% YoY to $16.00B, the only reportable segment to decrease.
Results That Matter
- Total net sales
- Current period
- $95.4B
- Prior period
- $90.8B
- Change
- +5.1%
Products net sales were $68,714M and Services net sales were $26,645M in the quarter. Management attributed the Services increase to higher net sales from advertising, the App Store and cloud services. - Gross margin
- Current period
- $44.9B
- Prior period
- $42.3B
- Change
- +6.1%
Total gross margin percentage was 47.1% versus 46.6%. Products gross margin percentage decreased to 35.9% from 36.6% due primarily to a different mix of products and weakness in foreign currencies relative to the U.S. dollar, partially offset by favorable costs; Services gross margin percentage increased to 75.7% from 74.6% due primarily to a different mix of services, partially offset by higher Services costs and weakness in foreign currencies relative to the U.S. dollar. - Operating income
- Current period
- $29.6B
- Prior period
- $27.9B
- Change
- +6.1%
Total operating expenses rose to $15,278M from $14,371M, with research and development up to $8,550M from $7,903M and selling, general and administrative up to $6,728M from $6,468M. - Income before provision for income taxes
- Current period
- $29.3B
- Prior period
- $28.1B
- Change
- +4.5%
Other income/(expense), net was $(279)M versus $158M in the prior-year quarter. - Net income
- Current period
- $24.8B
- Prior period
- $23.6B
- Change
- +4.8%
The provision for income taxes was $4,530M versus $4,422M, an effective tax rate of 15.5% versus 15.8%. - Diluted earnings per share
- Current period
- $1.65
- Prior period
- $1.53
- Change
- +7.8%
Weighted-average diluted shares were 15,056,133 thousand versus 15,464,709 thousand.
| Metric | Current Period | Prior Period | Change | Investor Takeaway |
|---|---|---|---|---|
| $95.4B | $90.8B | +5.1% | Products net sales were $68,714M and Services net sales were $26,645M in the quarter. Management attributed the Services increase to higher net sales from advertising, the App Store and cloud services. | |
| $44.9B | $42.3B | +6.1% | Total gross margin percentage was 47.1% versus 46.6%. Products gross margin percentage decreased to 35.9% from 36.6% due primarily to a different mix of products and weakness in foreign currencies relative to the U.S. dollar, partially offset by favorable costs; Services gross margin percentage increased to 75.7% from 74.6% due primarily to a different mix of services, partially offset by higher Services costs and weakness in foreign currencies relative to the U.S. dollar. | |
| $29.6B | $27.9B | +6.1% | Total operating expenses rose to $15,278M from $14,371M, with research and development up to $8,550M from $7,903M and selling, general and administrative up to $6,728M from $6,468M. | |
| $29.3B | $28.1B | +4.5% | Other income/(expense), net was $(279)M versus $158M in the prior-year quarter. | |
| $24.8B | $23.6B | +4.8% | The provision for income taxes was $4,530M versus $4,422M, an effective tax rate of 15.5% versus 15.8%. | |
| $1.65 | $1.53 | +7.8% | Weighted-average diluted shares were 15,056,133 thousand versus 15,464,709 thousand. |
Earnings Quality & Cash Conversion
Operating income of $29,589M includes total operating expenses of $15,278M, comprising research and development of $8,550M and selling, general and administrative of $6,728M. Other income/(expense), net of $(279)M is reported below operating income and includes the change in unrealized gains/losses on marketable debt securities, for which the filing reports an adjustment for net (gains)/losses realized and included in net income of $185M for the quarter. The filing reports no adjusted or non-GAAP earnings total.
Value Drivers & Capital Allocation
“During the second quarter of 2025, the Company repurchased $25.0 billion of its common stock and paid dividends and dividend equivalents of $3.8 billion.”
Filing statement
Period net income attributable to the parent / period-end equity, not annualized: 37.1% (prior at 2024-03-30: 31.9%); period net income attributable to the parent / period-end assets, not annualized: 7.5%.
Forward Signals
No quarterly revenue, margin or EPS guidance is provided in the filing; the filing states that the Company assumes no obligation to revise or update any forward-looking statements for any reason, except as required by law.
Known trends
- Tariffs and other trade measures: new U.S. Tariffs were announced beginning in the second quarter of 2025, including additional tariffs on imports from China, India, Japan, South Korea, Taiwan, Vietnam and the EU, and the ultimate impact remains uncertain.
- The Company believes, in general, gross margins will be subject to volatility and downward pressure.
Subsequent events
- On May 1, 2025, the Board of Directors authorized an additional program to repurchase up to $100 billion of the Company’s common stock and raised the quarterly cash dividend from $0.25 to $0.26 per share.
- On April 23, 2025, the European Commission fined the Company €500 million in the Article 5(4) Investigation and issued a cease and desist order; the Company plans to appeal.
- On April 30, 2025, the California District Court found the Company to be in violation of the 2021 Injunction and referred the Company to the U.S. Attorney for the Northern District of California for a determination whether criminal contempt proceedings are appropriate.
Risks
Excerpts are the filing’s own words; each heading is the start of its excerpt. Selected excerpts are not a complete risk inventory.
Tariffs and other measures that are applied to the Company’s products or their components…
Tariffs and other measures that are applied to the Company’s products or their components can have a material adverse impact on the Company’s business, results of operations and financial condition, including impacting the Company’s supply chain, the availability of rare earths and other raw materials and components, pricing and gross margin.
If the Commission makes a final determination in the Article 6(4) Investigation that there…
If the Commission makes a final determination in the Article 6(4) Investigation 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.
The California District Court also denied the Company’s motion to narrow or vacate the 2021…
The California District Court also denied the Company’s motion to narrow or vacate the 2021 Injunction and referred the Company to the U.S. Attorney for the Northern District of California for a determination whether criminal contempt proceedings are appropriate.
The Company’s gross margins are subject to volatility and downward pressure due to a variety…
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;
4 of 4 excerpts located in the filing text
Segments
| Segment | Revenue | Operating Income | Revenue Change | Commentary |
|---|---|---|---|---|
| Americas | $40.3B | $16.8B | +8.2% | Management attributed the increase primarily to higher net sales of iPhone and Services, and noted that weakness in foreign currencies relative to the U.S. dollar had an unfavorable year-over-year impact on Americas net sales. |
| Europe | $24.5B | $10.3B | +1.4% | Management stated Europe net sales were relatively flat in the second quarter of 2025 compared to the second quarter of 2024, and that weakness in foreign currencies relative to the U.S. dollar had a net unfavorable year-over-year impact. |
| Greater China | $16.0B | $6.6B | -2.3% | Management attributed the decrease to lower net sales of iPhone, and noted that weakness in the renminbi relative to the U.S. dollar had an unfavorable year-over-year impact; iPhone revenue represented a moderately higher proportion of net sales in Greater China. |
| Japan | $7.3B | $3.4B | +16.5% | Management attributed the increase primarily to higher net sales of iPhone and Services, and noted that weakness in the yen relative to the U.S. dollar had an unfavorable year-over-year impact. |
| Rest of Asia Pacific | $7.3B | $3.0B | +8.4% | Management attributed the increase primarily to higher net sales of Services and iPhone, and noted that changes in foreign currencies relative to the U.S. dollar had a net unfavorable year-over-year impact in the second quarter. |
Balance Sheet & Liquidity
Leverage: Identified debt as of 2025-03-29 (carrying amount): long-term debt including current maturities of $92.2B; noncurrent long-term debt of $78.6B; current portion of long-term debt of $13.6B. Not separately reported in this filing's standardized data: short-term borrowings. Total debt, net debt and debt-to-equity are therefore not stated.
Liquidity: The Company states its balances of cash, cash equivalents and marketable securities, 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. As of March 29, 2025, the Company had manufacturing purchase obligations of $38.4 billion payable within 12 months.
Working capital: Current assets $118.7B vs. current liabilities $144.6B (current ratio 0.82x). Prior reported balance sheet as of 2024-09-28: $153.0B vs. $176.4B (0.87x).
Maturities & covenants
- As of March 29, 2025 and September 28, 2024, the Company had outstanding fixed-rate notes with varying maturities for an aggregate carrying amount of $92.2 billion and $96.7 billion, respectively.
- As of March 29, 2025 and September 28, 2024, the fair value of the Company’s Notes, based on Level 2 inputs, was $80.9 billion and $88.4 billion, respectively.
- As of March 29, 2025, the maximum length of time over which the Company is hedging its exposure to the variability in future cash flows for term debt–related foreign currency transactions is 17 years.
Notable Footnotes
| Item | Impact |
|---|---|
| State Aid Decision tax payable | During the first six months of 2025, the Company released from escrow €14.2 billion or $15.4 billion to Ireland in connection with the State Aid Decision, which fully settled the obligation. |
| Deferred revenue | As of March 29, 2025 and September 28, 2024, the Company had total deferred revenue of $13.6 billion and $12.8 billion, respectively; as of March 29, 2025, the Company expects 66% of total deferred revenue to be realized in less than a year. |
| Share repurchase program | During the six months ended March 29, 2025, the Company repurchased 208 million shares of its common stock for $48.3 billion; remaining availability was $40.8 billion as of March 29, 2025. |
| Contingencies | In the opinion of management, there was not at least a reasonable possibility the Company may have incurred a material loss, or a material loss greater than a recorded accrual, concerning loss contingencies for asserted legal and other claims. |
Ask AAPL’s 10-Q anything
Answers come from this filing, with cited passages you can check. Try one:
AI-generated. Informational only, not investment advice. May be incomplete or contain errors. The authoritative source is always the original SEC filing.