Apple 2012 Annual Report Download - page 3

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Consumer and Small and Mid-Sized Business
The Company believes a high-quality buying experience with knowledgeable salespersons who can convey the
value of the Company’s products and services greatly enhances its ability to attract and retain customers. The
Company sells its products and resells third-party products in most of its major markets directly to consumers
and SMBs through its retail and online stores. The Company has also invested in programs to enhance reseller
sales by placing high quality Apple fixtures, merchandising materials and other resources within selected third-
party reseller locations. Through the Apple Premium Reseller Program, certain third-party resellers focus on the
Apple platform by providing a high level of product expertise, integration and support services.
The Company’s retail stores are typically located at high-traffic locations in quality shopping malls and urban
shopping districts. By operating its own stores and locating them in desirable high-traffic locations the Company
is better positioned to ensure a high quality customer buying experience and attract new customers. The stores
are designed to simplify and enhance the presentation and marketing of the Company’s products and related
solutions. To that end, retail store configurations have evolved into various sizes to accommodate market-specific
demands. The Company believes providing direct contact with its customers is an effective way to demonstrate
the advantages of its products over those of its competitors. The stores employ experienced and knowledgeable
personnel who provide product advice, service and training. The stores offer a wide selection of third-party
hardware, software, and other accessories and peripherals that complement the Company’s products.
Education
The Company is committed to delivering solutions to help educators teach and students learn. The Company
believes effective integration of technology into classroom instruction can result in higher levels of student
achievement and has designed a range of products, services and programs to address the needs of education
customers. The Company also supports mobile learning and real-time distribution of, and access to, education
related materials through iTunes U®, a platform that allows students and teachers to share and distribute
educational media online. The Company sells its products to the education market through its direct sales force,
select third-party resellers and its online and retail stores.
Enterprise and Government
The Company also sells its hardware and software products to enterprise and government customers in each of its
geographic segments. The Company’s products are deployed in these markets because of their performance,
productivity, ease of use and seamless integration into information technology environments. The Company’s
products are compatible with thousands of third-party business applications and services, and its tools enable the
development and secure deployment of custom applications as well as remote device administration.
Business Organization
The Company manages its business primarily on a geographic basis. Accordingly, the Company determined its
reportable operating segments, which are generally based on the nature and location of its customers, to be the
Americas, Europe, Japan, Asia-Pacific and Retail. The results of the Americas, Europe, Japan and Asia-Pacific
segments do not include results of the Retail segment. The Americas segment includes both North and
South America. The Europe segment includes European countries, as well as the Middle East and Africa. The
Asia-Pacific segment includes Australia and Asian countries, other than Japan. The Retail segment operates
Apple retail stores in 13 countries, including the U.S. Each operating segment provides similar hardware and
software products and similar services. Further information regarding the Company’s operating segments may be
found in Part II, Item 7 of this Form 10-K under the subheading “Segment Operating Performance,” and in Part
II, Item 8 of this Form 10-K in the Notes to Consolidated Financial Statements in Note 8, “Segment Information
and Geographic Data.”
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