AAPL — filing

Company Background

The Company designs, manufactures and markets smartphones, personal computers, tablets, wearables and accessories, and sells a variety of related services. The Company's fiscal year is the 52- or 53-week period that ends on the last Saturday of September.

Products

iPhone

iPhone ® is the Company's line of smartphones based on its iOS operating system. The iPhone line includes iPhone 17 Pro, iPhone Air™, iPhone 17, iPhone 16 and iPhone 16e.

Mac

Mac ® is the Company's line of personal computers based on its macOS ® operating system. The Mac line includes laptops MacBook Air ® and MacBook Pro ® , as well as desktops iMac ® , Mac mini ® , Mac Studio ® and Mac Pro ® .

iPad

iPad ® is the Company's line of multipurpose tablets based on its iPadOS ® operating system. The iPad line includes iPad Pro ® , iPad Air ® , iPad and iPad mini ® .

Wearables, Home and Accessories

Wearables includes smartwatches, wireless headphones and spatial computers. The Company's line of smartwatches, based on its watchOS ® operating system, includes Apple Watch ® Series 11, Apple Watch SE ® 3 and Apple Watch Ultra ® 3. The Company's line of wireless headphones includes AirPods ® , AirPods Pro ® , AirPods Max ® and Beats ® products. Apple Vision Pro™ is the Company's spatial computer based on its visionOS ® operating system.

Home includes Apple TV 4K ® , the Company's media streaming and gaming device based on its tvOS ® operating system, and HomePod ® and HomePod mini ® , high-fidelity wireless smart speakers.

Accessories includes Apple-branded and third-party accessories.

Apple Inc. | 2025 Form 10-K | 1

Services

Advertising

The Company's advertising services include third-party licensing arrangements and the Company's own advertising platforms.

AppleCare

The Company offers a portfolio of fee-based service and support products under the AppleCare ® brand. The offerings provide priority access to Apple technical support, access to the global Apple authorized service network for repair and replacement services, and in many cases additional coverage for instances of accidental damage or theft and loss, depending on the country and type of product.

Cloud Services

The Company's cloud services store and keep customers' content up-to-date and available across multiple Apple devices and Windows personal computers.

Digital Content

The Company operates various platforms, including the App Store ® , that allow customers to discover and download applications and digital content, such as books, music, video, games and podcasts.

The following summarizes factors that could have a material adverse effect on the Company's business, reputation, results of operations, financial condition and stock price. The Company may not be able to accurately predict, control or mitigate these risks. Statements in this section are based on the Company's beliefs and opinions regarding matters that could materially adversely affect the Company in the future and are not representations as to whether such matters have or have not occurred previously. The risks and uncertainties described below are not exhaustive and should not be considered a complete statement of all potential risks or uncertainties that the Company faces or may face in the future.

This section should be read in conjunction with Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the consolidated financial statements and accompanying notes in Part II, Item 8, "Financial Statements and Supplementary Data" of this Form 10-K.

Macroeconomic and Industry Risks

The Company's operations and performance depend significantly on global and regional economic conditions and adverse economic conditions can materially adversely affect the Company's business, results of operations, financial condition and stock price.

The Company has international operations with sales outside the U.S. representing a majority of the Company's total net sales. In addition, the Company's global supply chain is large and complex and a majority of the Company's supplier facilities, including manufacturing and assembly sites, are located outside the U.S. As a result, the Company's operations and performance depend significantly on global and regional economic conditions.

Adverse macroeconomic conditions, including slow growth or recession, high unemployment, inflation, tighter credit, higher interest rates, and currency fluctuations, can adversely impact consumer confidence and spending and materially adversely affect demand for the Company's products and services. In addition, consumer confidence and spending can be materially adversely affected in response to changes in fiscal and monetary policy, financial market volatility, declines in income or asset values, and other economic factors.

Uncertainty about, or a decline in, global or regional economic conditions can also have a significant impact on the Company's suppliers, contract manufacturers, logistics providers, distributors, cellular network carriers and other channel partners, and developers. Potential outcomes include financial instability; inability to obtain credit to finance business operations; and insolvency.

Digital Markets Act Investigations

On March 25, 2024, the Commission announced that it had opened a formal noncompliance investigation against the Company under Article 5(4) of the EU DMA ("Article 5(4) Investigation"). The Article 5(4) Investigation relates to how developers may communicate and promote offers to end users for apps distributed through the App Store, as well as how developers may conclude contracts with those end users. On June 24, 2024, the Commission announced that it had opened an additional formal investigation against the Company regarding whether the Company's new contractual requirements for third-party app developers and app marketplaces may violate the DMA ("Article 6(4) Investigation"). On April 23, 2025, the Commission fined the Company €500 million in the Article 5(4) Investigation and issued a cease and desist order requiring the Company to remove technical and commercial restrictions that prevent developers from steering users to alternative distribution channels outside the App Store. The Company has appealed the Commission's Article 5(4) decision. Also on April 23, 2025, the Commission issued preliminary findings in the Article 6(4) Investigation. 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 Commission may also seek to impose additional fines if it deems that the Company has violated a cease and desist order. The Company believes that it complies with the DMA and has continued to make changes to its compliance plan in response to feedback and engagement with the Commission.

Department of Justice Lawsuit

On March 21, 2024, 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" and "smartphones" in violation of U.S. antitrust laws. The DOJ is seeking equitable relief to redress the alleged anticompetitive behavior. In addition, various civil litigation matters have been filed in state and federal courts in the U.S. alleging similar violations of U.S. antitrust laws and seeking monetary damages and other nonmonetary relief. The Company believes it has substantial defenses and intends to vigorously defend itself.

Epic Games

Epic Games, Inc. filed a lawsuit in the U.S. District Court for the Northern District of California ("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 California District Court found that certain provisions of the Company's App Review Guidelines violate California's unfair competition law and issued an injunction (the "2021 Injunction") enjoining the Company from prohibiting developers from including in their apps buttons, external links, or other calls to action that direct customers to purchasing mechanisms other than the Company's in-app purchase system. The 2021 Injunction applies to apps on the U.S. storefronts of the iOS and iPadOS App Stores. On January 16, 2024, the Company implemented a plan to comply with the 2021 Injunction and filed a statement of compliance with the California District Court. On September 30, 2024, the Company filed a motion with the California District Court to narrow or vacate the 2021 Injunction. On April 30, 2025, the California District Court found the Company to be in violation of the 2021 Injunction and enjoined the Company from imposing any commission or any fee on purchases that consumers make outside an app; restricting, conditioning, limiting, or prohibiting how developers guide consumers to purchases outside an app; or otherwise interfering with a consumer's choice to proceed in or out of an app. 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 will continue to vigorously defend its actions and employees, and has appealed the California District Court's most recent decision to the U.S. Court of Appeals for the Ninth Circuit ("Ninth Circuit Court"). Although the Company's request to stay the decision pending appeal was denied, the Ninth Circuit Court has agreed to consider the Company's appeal on an expedited basis, with oral arguments heard in October 2025.

The Company's common stock is traded on The Nasdaq Stock Market LLC under the symbol AAPL.

Holders

As of October 17, 2025, there were 22,429 shareholders of record.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

Share repurchase activity during the three months ended September 27, 2025, was as follows (in millions, except number of shares, which are reflected in thousands, and per-share amounts):

Periods Total Number

of Shares Purchased Average Price

Paid Per Share Total Number of Shares

Purchased as Part of Publicly

Announced Plans or Programs Approximate Dollar Value of

Shares That May Yet Be Purchased

Under the Plans or Programs (1)

June 29, 2025 to August 2, 2025:

Open market and privately negotiated purchases 33,265 $ 210.43 33,265

August 3, 2025 to August 30, 2025:

Open market and privately negotiated purchases 28,986 $ 224.25 28,986

August 31, 2025 to September 27, 2025:

Open market and privately negotiated purchases 27,247 $ 238.56 27,247

Total 89,498 $ 99,779

(1) On May 2, 2024, the Company announced a program to repurchase up to $110 billion of the Company's common stock. During the fourth quarter of 2025, the Company utilized the final $19.8 billion under the May 2024 program. On May 1, 2025, the Company announced an additional program to repurchase up to $100 billion of the Company's common stock. As of September 27, 2025, $221 million of the May 2025 program had been utilized. The programs do not obligate the Company to acquire a minimum amount of shares. Under the programs, shares may be repurchased in privately negotiated or open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act.

Apple Inc. | 2025 Form 10-K | 19

Company Stock Performance

The following graph shows a comparison of five-year cumulative total shareholder return, calculated on a dividend-reinvested basis, for the Company, the S&P 500 Index and the Dow Jones U.S. Technology Total Stock Market Index. The graph assumes $100 was invested in each of the Company's common stock, the S&P 500 Index and the Dow Jones U.S. Technology Total Stock Market Index as of the market close on September 25, 2020. Past stock price performance is not necessarily indicative of future stock price performance.

September 2020 September 2021 September 2022 September 2023 September 2024 September 2025

Apple Inc. $ 100 $ 132 $ 136 $ 155 $ 208 $ 234

S&P 500 Index $ 100 $ 137 $ 115 $ 136 $ 185 $ 217

Dow Jones U.S. Technology Total Stock Market Index

$ 100 $ 147 $ 107 $ 147 $ 220 $ 287

Item 6. [Reserved]

Apple Inc. | 2025 Form 10-K | 20

The following discussion should be read in conjunction with the consolidated financial statements and accompanying notes included in Part II, Item 8 of this Form 10-K. This Item generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024. Discussions of 2023 items and year-to-year comparisons between 2024 and 2023 are not included, and can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended September 28, 2024.

Product, Service and Software Announcements

The Company announces new product, service and software offerings at various times during the year. Significant announcements during fiscal year 2025 included the following:

First Quarter 2025:

• MacBook Pro

• Mac mini

• iMac

• iPad mini

Second Quarter 2025:

• iPhone 16e

• iPad Air

• iPad

• MacBook Air

• Mac Studio

Third Quarter 2025:

• iOS 26, macOS Tahoe 26, iPadOS 26, watchOS 26, visionOS 26 and tvOS 26

Fourth Quarter 2025:

• iPhone 17, iPhone Air, iPhone 17 Pro and iPhone 17 Pro Max

• Apple Watch Series 11, Apple Watch SE 3 and Apple Watch Ultra 3

• AirPods Pro 3

Fiscal Period

The Company's fiscal year is the 52- or 53-week period that ends on the last Saturday of September. An additional week is included in the first fiscal quarter every five or six years to realign the Company's fiscal quarters with calendar quarters, which occurred in the first quarter of 2023. The Company's fiscal years 2025 and 2024 spanned 52 weeks each, whereas fiscal year 2023 spanned 53 weeks.

Macroeconomic Conditions

Macroeconomic conditions, including inflation, interest rates and currency fluctuations, have directly and indirectly impacted, and could in the future materially impact, the Company's results of operations and financial condition.

Apple Inc. | 2025 Form 10-K | 21

Tariffs and Other Measures

Beginning in the second quarter of 2025, new U.S. Tariffs were announced, including additional tariffs on imports from China, India, Japan, South Korea, Taiwan, Vietnam and the EU, among others. In response, several countries have imposed, or threatened to impose, reciprocal tariffs on imports from the U.S. and other retaliatory measures. Various modifications to the U.S. Tariffs have been announced and further changes could be made in the future, which may include additional sector-based tariffs or other measures. For example, the U.S. Department of Commerce has initiated an investigation under Section 232 of the Trade Expansion Act of 1962, as amended, into, among other things, imports of semiconductors, semiconductor manufacturing equipment, and their derivative products, including downstream products that contain semiconductors. 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. The ultimate impact remains uncertain and will depend on several factors, including whether additional or incremental U.S. Tariffs or other measures are announced or imposed, to what extent other countries implement tariffs or other retaliatory measures in response, and the overall magnitude and duration of these measures. Trade and other international disputes can have an adverse impact on the overall macroeconomic environment and result in shifts and reductions in consumer spending and negative consumer sentiment for the Company's products and services, all of which can further adversely affect the Company's business and results of operations.

The Company is exposed to economic risk from interest rates and foreign exchange rates. The Company uses various strategies to manage these risks; however, they may still impact the Company's consolidated financial statements.

Interest Rate Risk

The Company is primarily exposed to fluctuations in U.S. interest rates and their impact on the Company's investment portfolio and term debt. Increases in interest rates will negatively affect the fair value of the Company's investment portfolio and increase the interest expense on the Company's term debt. To protect against interest rate risk, the Company may use derivative instruments, offset interest rate-sensitive assets and liabilities, or control duration of the investment and term debt portfolios.

The following table sets forth potential impacts on the Company's investment portfolio and term debt, including the effects of any associated derivatives, that would result from a hypothetical increase in relevant interest rates as of September 27, 2025 and September 28, 2024 (dollars in millions):

Interest Rate

Sensitive Instrument

Hypothetical Interest

Rate Increase

Potential Impact

2025 2024

Investment portfolio 100 basis points, all tenors Decline in fair value

$ 2,416 $ 2,755

Term debt

100 basis points, all tenors Increase in annual interest expense $ 129 $ 139

Foreign Exchange Rate Risk

The Company's exposure to foreign exchange rate risk relates primarily to the Company being a net receiver of currencies other than the U.S. dollar. Changes in exchange rates, and in particular a strengthening of the U.S. dollar, will negatively affect the Company's net sales and gross margins as expressed in U.S. dollars. Fluctuations in exchange rates may also affect the fair values of certain of the Company's assets and liabilities. To protect against foreign exchange rate risk, the Company may use derivative instruments, offset exposures, or adjust local currency pricing of its products and services. However, the Company may choose to not hedge certain foreign currency exposures for a variety of reasons, including accounting considerations or prohibitive cost.

The Company applied a value-at-risk ("VAR") model to its foreign currency derivative positions to assess the potential impact of fluctuations in exchange rates. The VAR model used a Monte Carlo simulation. The VAR is the maximum expected loss in fair value, for a given confidence interval, to the Company's foreign currency derivative positions due to adverse movements in rates. Based on the results of the model, the Company estimates, with 95% confidence, a maximum one-day loss in fair value of $590 million and $538 million as of September 27, 2025 and September 28, 2024, respectively. Changes in the Company's underlying foreign currency exposures, which were excluded from the assessment, generally offset changes in the fair values of the Company's foreign currency derivatives.

Index to Consolidated Financial Statements Page

Consolidated Statements of Operations for the years ended September 27, 2025, September 28, 2024 and September 30, 2023

29

Consolidated Statements of Comprehensive Income for the years ended September 27, 2025, September 28, 2024 and September 30, 2023

30

Consolidated Balance Sheets as of September 27, 2025 and September 28, 2024

31

Consolidated Statements of Shareholders' Equity for the years ended September 27, 2025, September 28, 2024 and September 30, 2023

32

Consolidated Statements of Cash Flows for the years ended September 27, 2025, September 28, 2024 and September 30, 2023

33

Notes to Consolidated Financial Statements

34

Reports of Independent Registered Public Accounting Firm

49

All financial statement schedules have been omitted, since the required information is not applicable or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the consolidated financial statements and accompanying notes.

Apple Inc. | 2025 Form 10-K | 28

Apple Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except number of shares, which are reflected in thousands, and per-share amounts)

Years ended

September 27,

2025 September 28,

2024 September 30,

2023

Net sales:

Products $ 307,003 $ 294,866 $ 298,085

Services 109,158 96,169 85,200

Total net sales 416,161 391,035 383,285

Cost of sales:

Products 194,116 185,233 189,282

Services 26,844 25,119 24,855

Total cost of sales 220,960 210,352 214,137

Gross margin 195,201 180,683 169,148

Operating expenses:

Research and development 34,550 31,370 29,915

Selling, general and administrative 27,601 26,097 24,932

Total operating expenses 62,151 57,467 54,847

Operating income 133,050 123,216 114,301

Other income/(expense), net ( 321 ) 269 ( 565 )

Income before provision for income taxes 132,729 123,485 113,736

Provision for income taxes 20,719 29,749 16,741

Net income $ 112,010 $ 93,736 $ 96,995

Earnings per share:

Basic $ 7.49 $ 6.11 $ 6.16

Diluted $ 7.46 $ 6.08 $ 6.13

Shares used in computing earnings per share:

Basic 14,948,500 15,343,783 15,744,231

Diluted 15,004,697 15,408,095 15,812,547

See accompanying Notes to Consolidated Financial Statements.

Apple Inc. | 2025 Form 10-K | 29

Apple Inc.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)

Years ended

September 27,

2025 September 28,

2024 September 30,

2023

Net income $ 112,010 $ 93,736 $ 96,995

Other comprehensive income/(loss):

Change in foreign currency translation, net of tax ( 267 ) 395 ( 765 )

Change in unrealized gains/losses on derivative instruments, net of tax:

Change in fair value of derivative instruments 849 ( 832 ) 323