cik stringclasses 1
value | date stringlengths 8 8 | form stringclasses 4
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0000320193 | 20091027 | 10-K | 1,525 | Outstanding RSU balances are not included in the outstanding options balances in the stock option activity table. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,526 | Stock-Based Compensation
Stock-based compensation cost for RSUs is measured based on the closing fair market value of the Company’s common stock on the date of grant. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,527 | Stock-based compensation cost for stock options is estimated at the grant
date based on each option’s fair-value as calculated by the BSM option-pricing model. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,528 | The BSM option-pricing model incorporates various assumptions including expected volatility, expected life and interest rates. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,529 | The expected volatility is based on the historical volatility of the Company’s common stock over the most recent period commensurate with the estimated expected life of the Company’s stock options and other relevant factors including implied volatility in market traded options on the Company’s common stock. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,530 | The Company bases its expected life assumption on its historical experience and on the terms and conditions of the stock awards it grants to employees. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,531 | The Company recognizes stock-based compensation cost as expense ratably on a straight-line basis over the requisite service period. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,532 | The weighted-average assumptions used for the three years ended September 26, 2009, and the resulting estimates of weighted-average fair value per share of options granted and of employee stock purchase plan rights (“stock purchase rights”) during those periods are as follows:
(a) In conjunction with the Company’s 2009... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,533 | Accordingly the weighted average expected life of stock options was influenced by non-employee director stock option grants, which had a ten-year expected life. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,534 | The weighted average expected life of stock options also affects the resulting interest rate and expected volatility assumptions. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,535 | The following table provides a summary of the stock-based compensation expense included in the Consolidated Statements of Operations for the three years ended September 26, 2009 (in millions):
Stock-based compensation expense capitalized as software development costs was not significant as of September 26, 2009 or Sept... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,536 | The income tax benefit related to stock-based compensation expense was $266 million, $169 million and $81 million for 2009, 2008 and 2007, respectively. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,537 | The total unrecognized compensation cost related to stock options and RSUs expected to vest was $1.4 billion as of September 26, 2009, which is expected to be recognized over a weighted-average period of 2.53 years. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,538 | Note 8 - Commitments and Contingencies
Lease Commitments
The Company leases various equipment and facilities, including retail space, under noncancelable operating lease arrangements. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,539 | The Company does not currently utilize any other off-balance sheet financing arrangements. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,540 | The
major facility leases are generally for terms of one to 20 years and generally provide renewal options for terms of one to five additional years. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,541 | Leases for retail space are for terms of five to 20 years, the majority of which are for ten years, and often contain multi-year renewal options. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,542 | As of September 26, 2009, the Company’s total future minimum lease payments under noncancelable operating leases were $1.9 billion, of which $1.5 billion related to leases for retail space. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,543 | Rent expense under all operating leases, including both cancelable and noncancelable leases, was $231 million, $207 million and $151 million in 2009, 2008 and 2007, respectively. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,544 | Future minimum lease payments under noncancelable operating leases having remaining terms in excess of one year as of September 26, 2009, are as follows (in millions):
Accrued Warranty and Indemnifications
The Company offers a basic limited parts and labor warranty on its hardware products. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,545 | The basic warranty period for hardware products is typically one year from the date of purchase by the end-user. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,546 | The Company also offers a 90-day basic warranty for its service parts used to repair the Company’s hardware products. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,547 | The Company provides currently for the estimated cost that may be incurred under its basic limited product warranties at the time related revenue is recognized. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,548 | Factors considered in determining appropriate accruals for product warranty obligations include the size of the installed base of products subject to warranty protection, historical and projected warranty claim rates, historical and projected cost-per-claim, and knowledge of specific product failures that are outside o... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,549 | The Company assesses the adequacy of its preexisting warranty liabilities and adjusts the amounts as necessary based on actual experience and changes in future estimates. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,550 | For products accounted for under subscription accounting, the Company recognizes warranty expense as incurred. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,551 | The Company periodically provides updates to its applications and system software to maintain the software’s compliance with published specifications. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,552 | The estimated cost to develop such updates is accounted for as warranty costs that are recognized at the time related software revenue is recognized. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,553 | Factors considered in determining appropriate accruals related to such updates include the number of units delivered, the number of updates expected to occur, and the historical cost and estimated future cost of the resources necessary to develop these updates. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,554 | The following table reconciles changes in the Company’s accrued warranties and related costs for the three years ended September 26, 2009 (in millions):
The Company generally does not indemnify end-users of its operating system and application software against legal claims that the software infringes third-party intell... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,555 | Other agreements entered into by the Company sometimes include indemnification provisions under which the Company could be subject to costs and/or damages in the event of an infringement claim against the Company or an indemnified third-party. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,556 | However, the Company has not been required to make any significant payments resulting from such an infringement claim asserted against it or an indemnified third-party and, in the opinion of management, does not have a potential liability related to unresolved infringement claims subject to indemnification that would m... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,557 | Therefore, the Company did not record a liability for infringement costs as of either September 26, 2009 or September 27, 2008. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,558 | The Company has entered into indemnification agreements with its directors and executive officers. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,559 | Under these agreements, the Company has agreed to indemnify such individuals to the fullest extent permitted by law against liabilities that arise by reason of their status as directors or officers and to advance expenses incurred by such individuals in connection with related legal proceedings. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,560 | It is not possible to determine the maximum potential amount of payments the Company could be required to make under these agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each claim. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,561 | However, the Company maintains directors and officers liability insurance coverage to reduce its exposure to such obligations, and payments made under these agreements historically have not materially adversely affected the Company’s financial condition or operating results. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,562 | Concentrations in the Available Sources of Supply of Materials and Product
Although most components essential to the Company’s business are generally available from multiple sources, certain key components including but not limited to microprocessors, enclosures, certain liquid crystal displays (“LCDs”), certain optica... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,563 | Many of these and other key components that are available from multiple sources including but not limited to NAND flash memory, dynamic random access memory (“DRAM”) and certain LCDs, are subject at times to industry-wide shortages and significant commodity pricing fluctuations. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,564 | In addition, the Company has entered into certain agreements for the supply of key components including but not limited to microprocessors, NAND flash memory, DRAM and LCDs at favorable pricing, but there is no guarantee that the Company will be able to extend or renew these agreements on similar favorable terms, or at... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,565 | Therefore, the Company remains subject to significant risks of supply shortages and/or price increases that can materially adversely affect its financial condition and operating results. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,566 | The Company and other participants in the personal computer, mobile communication and consumer electronics industries also compete for various components with other industries that have experienced increased demand for their products. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,567 | In addition, the Company uses some custom components that are not common to the rest of the personal computer, mobile communication and consumer electronics industries, and new products introduced by the Company often utilize custom components available from only one source until the Company has evaluated whether there... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,568 | When a component or product uses new technologies, initial capacity constraints may exist until the suppliers’ yields have matured or manufacturing capacity has increased. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,569 | If the Company’s supply of a key single-sourced component for a new or existing product were delayed or constrained, if such components were available only at significantly higher prices, or if a key manufacturing vendor delayed shipments of completed products to the Company, the Company’s financial condition and opera... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,570 | The Company’s business and financial performance could also be adversely affected depending on the time required to obtain sufficient quantities from the original source, or to identify and obtain sufficient quantities from an alternative source. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,571 | Continued availability of these components at acceptable prices, or at all, may be affected if those suppliers decided to concentrate on the production of common components instead of components customized to meet the Company’s requirements. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,572 | Significant portions of the Company’s Mac computers, iPhones, iPods, logic boards and other assembled products are now manufactured by outsourcing partners, primarily in various parts of Asia. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,573 | A significant concentration of this outsourced manufacturing is currently performed by only a few of the Company’s outsourcing partners, often in single locations. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,574 | Certain of these outsourcing partners are the sole-sourced supplier of components and manufacturing outsourcing for many of the Company’s key products including but not limited to final assembly of substantially all of the Company’s portable Mac computers, iPhones, iPods and most of the Company’s desktop products. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,575 | Although
the Company works closely with its outsourcing partners on manufacturing schedules, the Company’s operating results could be adversely affected if its outsourcing partners were unable to meet their production commitments. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,576 | The Company’s purchase commitments typically cover its requirements for periods ranging from 30 to 150 days. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,577 | Long-Term Supply Agreements
The Company has entered into prepaid long-term supply agreements to secure the supply of certain inventory components. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,578 | During the first quarter of 2009, a long-term supply agreement with Intel Corporation was terminated and the remaining prepaid balance of $167 million was repaid to the Company. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,579 | During the second and fourth quarters of 2009, the Company made a prepayment of $500 million to LG Display for the purchase of LCD panels and a prepayment of $500 million to Toshiba to purchase NAND flash memory, respectively. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,580 | As of September 26, 2009, the Company had a total of $1.2 billion of inventory component prepayments outstanding. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,581 | Contingencies
The Company is subject to certain other legal proceedings and claims that have arisen in the ordinary course of business and have not been fully adjudicated, which are discussed in Part I, Item 3 of this Form 10-K under the heading “Legal Proceedings.” In the opinion of management, the Company does not ha... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,582 | However, the results of legal proceedings cannot be predicted with certainty. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,583 | If the Company failed to prevail in any of these legal matters or if several of these legal matters were resolved against the Company in the same reporting period, the operating results of a particular reporting period could be materially adversely affected. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,584 | Production and marketing of products in certain states and countries may subject the Company to environmental, product safety and other regulations including, in some instances, the requirement to provide customers the ability to return product at the end of its useful life, and place responsibility for environmentally... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,585 | Such laws and regulations have been passed in several jurisdictions in which the Company operates, including various countries within Europe and Asia and certain states and provinces within North America. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,586 | Although the Company does not anticipate any material adverse effects in the future based on the nature of its operations and the thrust of such laws, there is no assurance that such existing laws or future laws will not materially adversely affect the Company’s financial condition or operating results. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,587 | Note 9 - Segment Information and Geographic Data
The Company reports segment information based on the “management” approach. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,588 | The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of the Company’s reportable segments. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,589 | The Company manages its business primarily on a geographic basis. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,590 | Accordingly, the Company determined its operating segments, which are generally based on the nature and location of its customers, to be the Americas, Europe, Japan, Asia-Pacific, Retail and FileMaker operations. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,591 | The Company’s reportable operating segments consist of Americas, Europe, Japan and Retail operations. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,592 | Other operating segments include Asia Pacific, which encompasses Australia and Asia except for Japan and the Company’s FileMaker, Inc. subsidiary. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,593 | The Americas, Europe, Japan and Asia Pacific segments exclude activities related to the Retail segment. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,594 | The Americas segment includes both North and South America. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,595 | The Europe segment includes European countries, as well as the Middle East and Africa. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,596 | The Retail segment operates Apple-owned retail stores in the U.S. and in international markets. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,597 | Each reportable operating segment provides similar hardware and software products and similar services to the same types of customers. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,598 | The accounting policies of the various segments are the same as those described in Note 1, “Summary of Significant Accounting Policies.”
The Company evaluates the performance of its operating segments based on net sales and operating income. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,599 | Net sales for geographic segments are generally based on the location of customers, while Retail segment net sales are based on sales from the Company’s retail stores. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,600 | Operating income for each segment includes net sales to
third parties, related cost of sales and operating expenses directly attributable to the segment. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,601 | Advertising expenses are generally included in the geographic segment in which the expenditures are incurred. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,602 | Operating income for each segment excludes other income and expense and certain expenses managed outside the operating segments. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,603 | Costs excluded from segment operating income include various corporate expenses, such as manufacturing costs and variances not included in standard costs, research and development, corporate marketing expenses, stock-based compensation expense, income taxes, various nonrecurring charges, and other separately managed ge... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,604 | The Company does not include intercompany transfers between segments for management reporting purposes. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,605 | Segment assets exclude corporate assets, such as cash, short-term and long-term investments, manufacturing and corporate facilities, miscellaneous corporate infrastructure, goodwill and other acquired intangible assets. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,606 | Except for the Retail segment, capital asset purchases for long-lived assets are not reported to management by segment. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,607 | Cash payments for capital asset purchases by the Retail segment were $369 million, $389 million and $294 million for 2009, 2008 and 2007, respectively. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,608 | The Company has certain retail stores that have been designed and built to serve as high-profile venues to promote brand awareness and serve as vehicles for corporate sales and marketing activities. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,609 | Because of their unique design elements, locations and size, these stores require substantially more investment than the Company’s more typical retail stores. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,610 | The Company allocates certain operating expenses associated with its high-profile stores to corporate marketing expense to reflect the estimated Company-wide benefit. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,611 | The allocation of these operating costs to corporate expense is based on the amount incurred for a high-profile store in excess of that incurred by a more typical Company retail location. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,612 | The Company had opened a total of 11 high-profile stores as of September 26, 2009. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,613 | Expenses allocated to corporate marketing resulting from the operations of high-profile stores were $65 million, $53 million and $39 million for 2009, 2008 and 2007, respectively. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,614 | Summary information by operating segment for the three years ended September 26, 2009 is as follows (in millions):
(a) The Americas asset figures do not include fixed assets held in the U.S. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,615 | Such fixed assets are not allocated specifically to the Americas segment and are included in the corporate assets figures below. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,616 | (b) Retail segment depreciation and asset figures reflect the cost and related depreciation of its retail stores and related infrastructure. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,617 | (c) Other Segments include Asia-Pacific and FileMaker. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,618 | A reconciliation of the Company’s segment operating income and assets to the consolidated financial statements for the three years ended September 26, 2009 is as follows (in millions):
(a) Other corporate expenses include research and development, corporate marketing expenses, manufacturing costs and variances not incl... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,619 | No single customer or single country outside of the U.S. accounted for more than 10% of net sales in 2009, 2008 or 2007. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,620 | Net sales and long-lived assets related to the U.S. and international operations for the three years ended September 26, 2009, are as follows (in millions):
Information regarding net sales by product for the three years ended September 26, 2009, is as follows (in millions):
(a) Includes iMac, Mac mini, Mac Pro and Xser... | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,621 | (b) Includes MacBook, MacBook Air and MacBook Pro product lines. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,622 | (c) Consists of iTunes Store sales and iPod services, and Apple-branded and third-party iPod accessories. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,623 | (d) Derived from handset sales, carrier agreements, and Apple-branded and third-party iPhone accessories. | 0001193125-09-214859/full-submission.txt |
0000320193 | 20091027 | 10-K | 1,624 | (e) Includes sales of displays, wireless connectivity and networking solutions, and other hardware accessories. | 0001193125-09-214859/full-submission.txt |
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