Apple 2003 Annual Report Download - page 13

manufacturing facilities in Sacramento, California, and Cork, Ireland, and by external vendors in Fremont, California, Fullerton, California,
Taiwan, Korea, the Netherlands, the People's Republic of China, and the Czech Republic. Currently, manufacture of many of the components
used in the Company's products and final assembly of substantially all of the Company's portable products including PowerBooks, iBooks, and
the iPod are performed by third-party vendors in Japan, Taiwan and China. Margins on sales of Apple products in foreign countries, and on
sales of products that include components obtained from foreign suppliers, can be adversely affected by foreign currency exchange rate
fluctuations and by international trade regulations, including tariffs and antidumping penalties.
Information regarding financial data by geographic segment is set forth in Part II, Item 8 of this Form 10-K in the Notes to Consolidated
Financial Statements at Note 11, "Segment Information and Geographic Data."
Seasonal Business
Although the Company does not consider its business to be highly seasonal, it has historically experienced increased net sales in its first and
fourth fiscal quarters, compared to other quarters in its fiscal year, due to seasonal demand related to the holiday season and the school year,
respectively. Past performance should not be considered a reliable indicator of the Company's future net sales or financial performance.
Warranty
The Company offers a basic limited parts and labor warranty on its hardware products. The basic warranty period for hardware products is
typically one year from the date of purchase by the end-user. The Company also offers a 90-day basic warranty for Apple software and for
Apple service parts used to repair Apple hardware products. In addition, consumers may purchase extended service coverage on most Apple
hardware products in all of the Company's major markets.
Backlog
In the Company's experience, the actual amount of product backlog at any particular time is not a meaningful indication of its future business
prospects. In particular, backlog often increases in anticipation
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of or immediately following new product introductions because of over ordering by dealers anticipating shortages. Backlog often is reduced
once dealers and customers believe they can obtain sufficient supply. Because of the foregoing, backlog should not be considered a reliable
indicator of the Company's ability to achieve any particular level of revenue or financial performance.
Environmental Laws
Compliance with federal, state, local, and foreign laws enacted for the protection of the environment has to date had no material effect upon the
Company's capital expenditures, earnings, or competitive position. Although the Company does not anticipate any material adverse effects in
the future based on the nature of its operations and the subject of these laws, there is no assurance that such existing laws or future laws will not
have a material adverse affect on the Company.
Production and marketing of products in certain states and countries may subject the Company to environmental and other regulations
including, in some instances, the requirement that the Company provide consumers with the ability to return to the Company product at the end
of its useful life, and place responsibility for environmentally safe disposal or recycling with the Company. Such laws and regulations have
recently been passed in several jurisdictions in which the Company operates, including various European Union member states, Japan and
California. 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 have a material adverse affect on the Company.
Employees
As of September 27, 2003, Apple and its subsidiaries worldwide had 10,912 employees and an additional 2,654 temporary employees and
contractors.
Available Information
Beginning in fiscal 2003, the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and
amendments to reports filed pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, are available on its
website at www.apple.com/investor when such reports are available on the Securities and Exchange Commission (SEC) website. The public
may read and copy any materials filed by the Company with the SEC at the SEC's Public Reference Room at 450 Fifth Street, NW,
Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-
0330. The SEC maintains an Internet site that contains reports, proxy and information statements and other information regarding issuers that