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# Provision for Income Taxes |
Provision for income taxes, effective tax rate and statutory federal income tax rate for the three- and nine-month periods ended June 29, 2024 and July 1, 2023 were as follows (dollars in millions): |
| | |Three Months Ended| | | |Nine Months Ended| | |
|---|---|---|---|---|---|---|---| |
| | | |June 29, 2024|July 1, 2023|June 29, 2024|July 1, 2023| | |
|Provision for income taxes|$4,046|$2,852|$14,875|$12,699| | | | |
|Effective tax rate|15.9%|12.5%|15.8%|14.6%| | | | |
|Statutory federal income tax rate|21%|21%|21%|21%| | | | |
The Company’s effective tax rate for the third quarter and first nine months of 2024 was lower than the statutory federal income tax rate due primarily to a lower effective tax rate on foreign earnings, the impact of the U.S. federal R&D credit, and tax benefits from share-based compensation, partially offset by state ... |
The Company’s effective tax rate for the third quarter and first nine months of 2024 was higher compared to the same periods in 2023 due primarily to a higher effective tax rate on foreign earnings and lower tax benefits from share-based compensation, partially offset by lower state income taxes. |
# Liquidity and Capital Resources |
The Company believes its balances of cash, cash equivalents and unrestricted 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. |
The Company’s contractual cash requirements have not changed materially since the 2023 Form 10-K, except for manufacturing purchase obligations. |
# Manufacturing Purchase Obligations |
The Company utilizes several outsourcing partners to manufacture subassemblies for the Company’s products and to perform final assembly and testing of finished products. The Company also obtains individual components for its products from a wide variety of individual suppliers. As of June 29, 2024, the Company had manu... |
# Capital Return Program |
In addition to its contractual cash requirements, the Company has authorized share repurchase programs. The programs do not obligate the Company to acquire a minimum amount of shares. As of June 29, 2024, the Company’s quarterly cash dividend was $0.25 per share. The Company intends to increase its dividend on an annua... |
During the third quarter of 2024, the Company repurchased $26.0 billion of its common stock and paid dividends and dividend equivalents of $3.9 billion. |
# Recent Accounting Pronouncements |
Income Taxes |
In December 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which will require the Company to disclose specified additional information in its income tax rate reconciliat... |
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# Segment Reporting |
In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which will require the Company to disclose segment expenses that are significant and regularly provided to the Company’s chief operating decision maker (“CODM”). In addition,... |
# Critical Accounting Estimates |
The preparation of financial statements and related disclosures in conformity with GAAP and the Company’s discussion and analysis of its financial condition and operating results require the Company’s management to make judgments, assumptions and estimates that affect the amounts reported. Note 1, “Summary of Significa... |
# Item 3. Quantitative and Qualitative Disclosures About Market Risk |
There have been no material changes to the Company’s market risk during the first nine months of 2024. For a discussion of the Company’s exposure to market risk, refer to the Company’s market risk disclosures set forth in Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” of the 2023 Form 10... |
# Item 4. Controls and Procedures |
Evaluation of Disclosure Controls and Procedures |
Based on an evaluation under the supervision and with the participation of the Company’s management, the Company’s principal executive officer and principal financial officer have concluded that the Company’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act were effe... |
Changes in Internal Control over Financial Reporting |
There were no changes in the Company’s internal control over financial reporting during the third quarter of 2024, which were identified in connection with management’s evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act, that have materially affected, or are reasonably likely to mate... |
Apple Inc. | Q3 2024 Form 10-Q | 18 |
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# PART II — OTHER INFORMATION |
# Item 1. Legal Proceedings |
Digital Markets Act Investigations |
On March 25, 2024, the Commission announced that it had opened two formal noncompliance investigations against the Company under the European Union (“EU”) Digital Markets Act (the “DMA”). The Commission’s investigations concern (1) Article 5(4) of the DMA, which relates to how developers may communicate and promote off... |
Department of Justice Lawsuit |
On March 21, 2024, the U.S. Department of Justice (the “DOJ”) and a number of state and district attorneys general filed a civil antitrust lawsuit in the U.S. District Court for the District of New Jersey against the Company alleging monopolization or attempted monopolization in the markets for “performance smartphones... |
Epic Games |
Epic Games, Inc. (“Epic”) filed a lawsuit in the U.S. District Court for the Northern District of California (the “California District Court”) against the Company alleging violations of federal and state antitrust laws and California’s unfair competition law based upon the Company’s operation of its App Store. The Cali... |
Other Legal Proceedings |
The Company is subject to other legal proceedings and claims that have not been fully resolved and that have arisen in the ordinary course of business. The Company settled certain matters during the third quarter of 2024 that did not individually or in the aggregate have a material impact on the Company’s financial con... |
# Item 1A. Risk Factors |
The Company’s business, reputation, results of operations, financial condition and stock price can be affected by a number of factors, whether currently known or unknown, including those described in Part I, Item 1A of the 2023 Form 10-K and Part II, Item 1A of the Form 10-Q for the quarter ended March 30, 2024 (the “s... |
Apple Inc. | Q3 2024 Form 10-Q | 19 |
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# Item 2. Unregistered Sales of Equity Securities and Use of Proceeds |
|Periods|Total Number of Shares Purchased|Average Price Paid Per Share|Total Number Purchased as Part of Publicly Announced Plans or Programs| |
|---|---|---|---| |
|March 31, 2024 to May 4, 2024:|45,690|$169.74|45,690| |
|May 5, 2024 to June 1, 2024:|51,729|$188.38|51,729| |
|June 2, 2024 to June 29, 2024:|41,354|$205.54|41,354| |
|Total|138,773| |$114,074| |
(1) On May 4, 2023, the Board of Directors authorized the purchase of up to $90 billion of the Company’s common stock under a share repurchase program. As of June 29, 2024, remaining availability under the May 2023 program was $4.1 billion. On May 2, 2024, the Board of Directors authorized an additional program to repu... |
# Item 3. Defaults Upon Senior Securities |
None. |
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