Apple 2012 Annual Report Download - page 26

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and
other parts of this Form 10-K contain forward-looking statements, within the meaning of the Private Securities
Litigation Reform Act of 1995, that involve risks and uncertainties. Forward-looking statements provide current
expectations of future events based on certain assumptions and include any statement that does not directly
relate to any historical or current fact. Forward-looking statements can also be identified by words such as
“future,” “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “will,” “would,”
“could,” “can,” “may,” 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 Part I, Item 1A of this Form 10-K under the heading “Risk Factors,” which are incorporated herein
by reference. The following discussion should be read in conjunction with the consolidated financial statements
and notes thereto included in Part II, Item 8 of this Form 10-K. All information presented herein is based on the
Company’s fiscal calendar. Unless otherwise stated, references to particular years or quarters refer to the
Company’s fiscal years ended in September and the associated quarters of those fiscal years. Each of the terms
the “Company” and “Apple” as used herein refers collectively to Apple Inc. and its wholly-owned subsidiaries,
unless otherwise stated. The Company assumes no obligation to revise or update any forward-looking statements
for any reason, except as required by law.
Executive Overview
The Company designs, manufactures, and markets mobile communication and media devices, personal computers,
and portable digital music players, and sells a variety of related software, services, peripherals, networking
solutions, and third-party digital content and applications. The Company’s products and services include iPhone,
iPad, Mac, iPod, Apple TV, a portfolio of consumer and professional software applications, the iOS and OS X
operating systems, iCloud, and a variety of accessory, service and support offerings. The Company also sells and
delivers digital content and applications through the iTunes Store, App Store, iBookstore, and Mac App Store. The
Company sells its products worldwide through its retail stores, online stores, and direct sales force, as well as
through third-party cellular network carriers, wholesalers, retailers, and value-added resellers. In addition, the
Company sells a variety of third-party iPhone, iPad, Mac and iPod compatible products, including application
software, and various accessories through its online and retail stores. The Company sells to consumers; small and
mid-sized businesses; and education, enterprise and government customers.
The Company is committed to bringing the best user experience to its customers through its innovative hardware,
software, peripherals, and services. The Company’s business strategy leverages its unique ability to design and
develop its own operating systems, hardware, application software, and services to provide its customers new
products and solutions with superior ease-of-use, seamless integration, and innovative design. As part of its
strategy, the Company continues to expand its platform for the discovery and delivery of third-party digital
content and applications through the iTunes Store. As part of the iTunes Store, the Company’s App Store and
iBookstore allow customers to discover and download applications and books through either a Mac or Windows-
based computer or through “iOS devices,” namely iPhone, iPad and iPod touch. The Company’s Mac App Store
allows customers to easily discover, download and install Mac applications. The Company also supports a
community for the development of third-party software and hardware products and digital content that
complement the Company’s offerings. The Company’s strategy also includes expanding its distribution network
to effectively reach more customers and provide them with a high-quality sales and post-sales support
experience.
The Company participates in several highly competitive markets, including the market for mobile
communications and media devices with its iOS devices; personal computers with its Mac computers; portable
digital players with iPod; and distribution of third-party digital content and applications with the iTunes Store,
App Store, iBookstore, and Mac App Store. While the Company is widely recognized as a leading innovator in
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