Apple 2004 Annual Report Download - page 26

Download and view the complete annual report

Please find page 26 of the 2004 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 132

  • 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

Item 8 of this Form 10-K in order to fully understand factors that may affect the comparability of the information presented below.
Net gains before taxes related to the Company's non
-current debt and equity investments of $4 million, $10 million, $75 million, and
$367 million were recognized in 2004, 2003, 2001, and 2000, respectively. A net loss before taxes related to the Company's non-
current debt and
equity investments of $42 million was recognized in 2002. In 2002, the Company acquired Emagic resulting in a charge of approximately
$1 million for acquired in-process technologies with no alternative future use. The Company recognized a similar charge of $11 million in 2001
related to its acquisition of PowerSchool. Net charges related to Company restructuring actions of $23 million, $26 million, $30 million, and
$8 million were recognized in 2004, 2003, 2002, and 2000, respectively. During 2000, the Company recognized the cost of 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. In 2002, of the original $90 million accrual, $2 million remained unspent and was reversed. In 2003, settlement of the Company's
forward stock purchase agreement resulted in a gain of $6 million. Favorable cumulative-effect type adjustments, net of taxes, of $1 million and
$12 million were recognized in 2003 and 2001, respectively.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
This section and other parts of this Form 10-K contain forward-looking statements that involve risks and uncertainties. Forward-looking
statements can also be identified by words such as "anticipates," "expects," "believes," "plans," "predicts," and similar terms. Forward-looking
statements are not guarantees of future performance and the Company's actual results may differ significantly from the results discussed in the
forward
-looking statements. Factors that might cause such differences include, but are not limited to, those discussed in the subsection entitled
"Factors That May Affect Future Results and Financial Condition" below. The following discussion should be read in conjunction with the
consolidated financial statements and notes thereto included in Item 8 of this Form 10-K. All information presented herein is based on the
Company's fiscal calendar. The Company assumes no obligation to revise or update any forward-looking statements for any reason, except as
required by law.
Executive Overview
Apple designs, manufactures and markets personal computers and related software, services, peripherals and networking solutions. The
Company also designs, develops and markets a line of portable digital music
23
Five fiscal years ended September 25, 2004
(In millions, except share and per share amounts)
2004
2003
2002
2001
2000
Net sales
$
8,279
$
6,207
$
5,742
$
5,363
$
7,983
Net income (loss)
$
276
$
69
$
65
$
(25
)
$
786
Earnings (loss) per common share:
Basic
$
0.74
$
0.19
$
0.18
$
(0.07
)
$
2.42
Diluted
$
0.71
$
0.19
$
0.18
$
(0.07
)
$
2.18
Cash dividends declared per common share
$
—
$
—
$
—
$
—
$
—
Shares used in computing earnings (loss) per share (in
thousands):
Basic
371,590
360,631
355,022
345,613
324,568
Diluted
387,311
363,466
361,785
345,613
360,324
Cash, cash equivalents, and short
-
term investments
$
5,464
$
4,566
$
4,337
$
4,336
$
4,027
Total assets
$
8,050
$
6,815
$
6,298
$
6,021
$
6,803
Long
-
term debt (including current maturities)
$
—
$
304
$
316
$
317
$
300
Total liabilities
$
2,974
$
2,592
$
2,203
$
2,101
$
2,696
Shareholders' equity
$
5,076
$
4,223
$
4,095
$
3,920
$
4,107