Apple 2003 Annual Report Download - page 77

Download and view the complete annual report

Please find page 77 of the 2003 Apple annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 164

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164

A large portion of the Company's net sales is derived from its international operations. Also, a majority of the raw materials used in the
Company's products is obtained from sources outside of the United States, and a majority of the products sold by the Company is assembled
internationally in the Company's facility in Cork, Ireland or by third-party vendors in Taiwan, Korea, the Netherlands, the People's Republic of
China, and the Czech Republic. As a result, the Company is subject to risks associated with foreign operations, such as obtaining governmental
permits and approvals, currency exchange fluctuations, currency restrictions, political instability, labor problems, trade restrictions, and
changes in tariff and freight charges. No single customer accounted for more than 10% of net sales in 2003, 2002 or 2001.
Net sales and long
-lived assets related to operations in the United States, Japan, and other foreign countries are as follows (in millions):
98
Information regarding net sales by product is as follows (in millions):
(a)
2003
2002
2001
Net Sales:
United States
$
3,627
$
3,272
$
2,936
Japan
698
710
713
Other Foreign Countries
1,882
1,760
1,714
Total Net Sales $
6,207
$
5,742
$
5,363
Long
-
Lived Assets:
United States
$
635
$
561
$
498
Japan
19
2
3
Other Foreign Countries
60
69
77
Total Long-Lived Assets $
714
$
632
$
578
2003
2002
2001
Net Sales:
Power Macintosh(a)
$
1,237
$
1,380
$
1,664
PowerBook
1,299
831
813
iMac
1,238
1,448
1,117
iBook
717
875
809
Total Macintosh Net Sales $
4,491
$
4,534
$
4,403
Peripherals and other hardware(b)
1,058
674
387
Software(c)
362
307
230
Service and other Net Sales
296
227
343
Total Net Sales $
6,207
$
5,742
$
5,363
Power Macintosh figures include server sales.
(b) Net sales of peripherals and other hardware include sales of iPod, Apple-branded and third-party displays, and other hardware
accessories.
(c) Net sales of software include sales of Apple-branded operating system and application software and sales of third-party
software.
Note 12—Related Party Transactions and Certain Other Transactions
During the first quarter of 2000, the Company's Board of Directors approved a special executive bonus for the Company's Chief Executive
Officer for past services in the form of an aircraft with a total cost to the Company of approximately $90 million, the majority of which was not
tax deductible. Approximately half of the total charge was for the cost of the aircraft. The other half represented all other costs and taxes