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Apple: Financial AnalysisMar-03Jun-03Sep-03Dec-03Mar-04Jun-04Sep-04Dec-04Mar-05Jun-05Sep-05Dec-05Mar-06Jun-06Sep-06Dec-06Mar-07Jun-07Sep-07Dec-07Mar-08Jun-08Sep-08 EFY 2005FY 2006FY 2007FY 2008EFY 2009E

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Analysis By:

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Silicon Alley Insider

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INCOME STATEMENTMar-03Jun-03Sep-03Dec-03Mar-04Jun-04Sep-04Dec-04Mar-05Jun-05Sep-05Dec-05Mar-06Jun-06Sep-06Dec-06Mar-07Jun-07Sep-07Dec-07Mar-08Jun-082005200620072008E2009E

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Revenues$1,475,000$1,545,000$1,715,000$2,006,000$1,909,000$2,014,000$2,350,000$3,490,000$3,243,000$3,520,000$3,678,000$5,749,000$4,359,000$4,370,000$4,837,000$7,115,000$5,264,000$5,410,000$6,217,000$9,608,000$7,512,000$7,464,000$16,190,000$20,681,000$26,499,000$31,128,912$39,771,172

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Y/Y Change34%24%32%24%21%24%29%35%43%38%28%28%17%28%

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Cost of Sales$1,057,000$1,117,000$1,259,000$1,470,000$1,379,000$1,455,000$1,716,000$2,494,000$2,275,000$2,476,000$2,643,000$4,185,000$3,062,000$3,045,000$3,425,000$4,895,000$3,415,000$3,415,000$4,127,000$6,276,000$5,038,000$4,864,000$11,579,000$14,427,000$17,233,000$20,233,793$25,453,550

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Margin72%72%73%73%72%72%73%71%70%70%72%73%70%70%71%69%65%63%66%65%67%67%72%70%65%65%64%

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Gross Profit$418,000$428,000$456,000$536,000$530,000$559,000$634,000$996,000$968,000$1,044,000$1,035,000$1,564,000$1,297,000$1,325,000$1,412,000$2,220,000$1,849,000$1,995,000$2,090,000$3,332,000$2,474,000$2,600,000$4,611,000$6,254,000$9,266,000$10,895,119$14,317,622

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Margin28%28%27%27%28%28%27%29%30%30%28%27%30%30%29%31%35%37%34%35%33%35%28%30%35%35%36%

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R&D$119,000$120,000$111,000$119,000$128,000$129,000$122,000$123,000$119,000$145,000$147,000$182,000$176,000$175,000$179,000$184,000$183,000$208,000$207,000$246,000$273,000$292,000$593,000$714,000$844,000$1,245,156$1,590,847

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Margin8%8%6%6%7%6%5%4%4%4%4%3%4%4%4%3%3%4%3%3%4%4%4%3%3%4%4%

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SG&A$303,000$299,000$314,000$343,000$350,000$358,000$384,000$470,000$447,000$473,000$470,000$632,000$592,000$584,000$625,000$714,000$680,000$746,000$823,000$960,000$886,000$916,000$2,022,000$2,515,000$3,209,000$4,046,759$5,170,252

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Margin21%19%18%17%18%18%16%13%14%13%13%11%14%13%13%10%13%14%13%10%12%13%12%12%12%13%13%

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Total$422,000$419,000$425,000$462,000$478,000$487,000$506,000$593,000$566,000$618,000$617,000$814,000$768,000$759,000$804,000$898,000$863,000$954,000$1,030,000$1,206,000$1,159,000$1,208,000$2,615,000$3,229,000$4,053,000$5,291,915$6,761,099

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Margin29%27%25%23%25%24%22%17%17%18%17%14%18%17%17%13%16%18%17%13%15%16%16%16%15%17%17%

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Operating Income-$4,000$9,000$31,000$74,000$52,000$72,000$128,000$403,000$402,000$427,000$418,000$750,000$529,000$566,000$609,000$1,322,000$986,000$1,041,000$1,060,000$2,126,000$1,315,000$1,392,000$1,997,000$3,026,000$5,213,000$5,603,204$7,556,523

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Margin0%1%2%4%3%4%5%12%12%12%11%13%12%13%13%19%19%19%17%22%18%19%12%15%20%18%19%

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Other income and expense$23,000$17,000$27,000$13,000$12,000$13,000$19,000$26,000$33,000$46,000$60,000$81,000$76,000$95,000$113,000$126,000$148,000$155,000$170,000$200,000$162,000$118,000$220,000$410,000$673,000$933,867$1,193,135

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Margin2%1%2%1%1%1%1%1%1%1%2%1%2%2%2%2%3%3%3%2%2%3%1%2%3%3%3%

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Pre-Tax Income$19,000$26,000$58,000$87,000$64,000$85,000$147,000$429,000$435,000$472,000$478,000$831,000$605,000$661,000$721,000$1,448,000$1,134,000$1,196,000$1,230,000$2,326,000$1,477,000$1,510,000$2,216,000$3,435,000$5,886,000$6,537,071$8,749,658

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Margin1%2%3%4%3%4%6%12%13%13%13%14%14%15%15%20%22%22%20%24%20%20%14%17%22%21%22%

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Tax$5,000$7,000$14,000$24,000$18,000$24,000$41,000$134,000$145,000$153,000$48,000$266,000$195,000$189,000$179,000$444,000$364,000$378,000$326,000$745,000$432,000$468,100$612,000$1,007,000$1,813,000$1,961,121$2,624,897

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% of Pre-Tax26%27%24%28%28%28%28%31%33%32%10%32%32%29%25%31%32%32%27%32%29%31%28%29%31%30%30%

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Net Income$14,000$19,000$44,000$63,000$46,000$61,000$106,000$295,000$290,000$320,000$430,000$565,000$410,000$472,000$546,000$1,004,000$770,000$818,000$904,000$1,581,000$1,045,000$1,072,000$1,605,000$2,432,000$4,073,000$4,575,950$6,124,760

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Margin0.95%1.23%2.57%3.14%2.41%3.03%4.51%8.45%8.94%9.09%11.69%9.83%9.41%10.80%11.29%14.11%14.63%15.12%14.54%16.46%13.91%14.36%10%12%15%15%15%

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EPS (Diluted)$0.04$0.05$0.12$0.17$0.12$0.16$0.26$0.70$0.34$0.37$0.50$0.65$0.47$0.54$0.62$1.14$0.87$0.92$1.01$1.76$1.16$1.19$1.85$2.76$4.55$5.01$6.58

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Y/Y Change38%45%25%76%86%71%62%55%34%30%

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Shares Out (Diluted)362,243363,777370,733372,308378,230392,621402,906419,087857,011860,688866,404874,207878,537876,368878,757883,297886,653890,671895,666900,054899,329908,484856,780877,526895,077912,978931,238

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Y/Y Change3%2%1%1%1%2%2%2%2%2%2%2%2%2%

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PRODUCT SUMMARYMar-05Jun-05Sep-05Dec-05Mar-06Jun-06Sep-06Dec-06Mar-07Jun-07Sep-07Dec-07Mar 08

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DESKTOP COMPUTERS

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Units (000s)6236086876026676145296246376266348179778569432,5642,4043,0543,7564,696

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Y/Y Change1%-23%4%-4%2%20%31%53%37%49%-6%27%23%25%

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Revenues$1,001,000$803,000$845,000$787,000$912,000$833,000$705,000$869,000$955,000$914,000$956,000$1,195,000$1,515,000$1,352,000$1,373,000$3,347,000$3,362,000$4,580,000$5,841,736$7,667,278

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Y/Y Change4%-17%10%5%10%36%38%59%48%44%0%36%28%31%

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% of Total25%24%21%16%19%16%18%13%17%18%18%16%18%18%21%16%17%19%19%

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Revenue/Unit$1,321$1,230$1,307$1,367$1,357$1,333$1,393$1,499$1,460$1,508$1,463$1,551$1,579$1,456$1,306$1,395$1,495$1,555$1,633

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Y/Y Change3%8%7%10%8%13%5%3%3%-3%7%7%4%5%

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PORTABLE COMPUTERS

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Units (000s)4624956345874987989869698911,1301,3471,3421,4331,5532,1783,2514,7106,83010,244

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Y/Y Change8%61%56%65%79%42%37%38%61%37%49%45%45%50%

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Revenues$691,000$720,000$824,000$812,000$739,000$1,161,000$1,344,000$1,455,000$1,354,000$1,577,000$1,908,000$2,037,000$2,142,000$2,237,000$3,047,000$4,699,000$6,876,000$9,787,680$14,975,150

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Y/Y Change7%61%63%79%83%36%42%40%58%42%54%46%42%53%

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% of Total21%20%22%14%17%27%28%20%26%29%31%21%29%30%19%23%26%31%38%

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Revenue/Unit$1,496$1,455$1,300$1,383$1,484$1,455$1,363$1,502$1,520$1,396$1,416$1,518$1,495$1,396$1,408$1,451$1,462$1,433$1,462

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Y/Y Change-1%0%5%9%2%-4%4%1%1%0%3%1%-2%2%

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TOTAL COMPUTERS

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Units (000s)1,0701,1821,2361,2541,1121,3271,6101,6061,5171,7642,1642,3192,2892,4962,6504,7425,6557,051

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Y/Y Units Change374352405437554713772732486

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Y/Y Change4%12%30%28%36%33%34%44%51%41%22%19%25%

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Revenues$1,494,000$1,565,000$1,611,000$1,724,000$1,572,000$1,866,000$2,213,000$2,410,000$2,268,000$2,533,000$3,103,000$3,552,000$3,494,000$3,610,000$6,394,000$8,061,000$10,314,000

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Y/Y Change5%19%37%40%44%36%40%47%54%43%26%28%

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% of Total46%44%44%30%36%43%46%34%43%47%50%37%47%48%39%39%39%

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Revenue/Unit$1,396$1,324$1,303$1,375$1,414$1,406$1,375$1,501$1,495$1,436$1,434$1,532$1,526$1,446$1,350$1,424$1,444

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Y/Y Change1%6%5%9%6%2%4%2%2%1%5%1%

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iPODS

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Units (000s)5,3116,1556,45114,0438,5268,1118,72921,06610,5499,81510,20022,12110,64411,01131,96046,43252,68563,22277,131

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Y/Y Change61%32%35%50%24%21%17%5%1%12%45%13%20%22%

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Revenues$1,014,000$1,103,000$1,212,000$2,906,000$1,714,000$1,497,000$1,559,000$3,427,000$1,689,000$1,570,000$1,619,000$3,997,000$1,818,000$1,678,000$6,235,000$8,197,000$8,875,000$8,859,936$9,728,210

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Y/Y Change69%36%29%18%-1%5%4%17%8%7%31%8%0%10%

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% of Total31%31%33%51%39%34%32%48%32%29%26%42%24%22%39%40%33%28%24%

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Revenue/Unit$191$179$188$207$201$185$179$163$160$160$159$181$171$152$191$182$165$140$126

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Y/Y Change5%3%-5%-21%-20%-13%-11%11%5%-5%-5%-9%-15%-10%

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OTHER MUSIC PRODUCTS

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Revenues$216,000$241,000$265,000$491,000$485,000$457,000$452,000$634,000$653,000$608,000$601,000$808,000$881,000$819,000$1,213,000$2,028,000$2,670,000$2,937,000$3,142,590

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Y/Y Change125%90%71%29%35%33%33%27%35%35%67%32%10%7%

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% of Total7%7%7%9%11%10%9%9%12%11%10%8%12%11%10%10%9%8%

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iPHONES

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Units (000s)2701,1192,3151,7037173,70410,00010,000

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Revenues$5,000$118,000$241,000$378,000$419,000$364,000$2,000,000$1,750,000

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% of Total0%2%3%5%6%1%6%4%

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Revenue/Unit$19$105$104$222$584$105$200$175

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PERIPHERALS & OTHER HW

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Revenues$280,000$266,000$296,000$303,000$264,000$236,000$297,000$297,000$309,000$308,000$346,000$382,000$412,000$437,000$1,145,000$1,094,000$1,345,000$1,573,650$1,809,698

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Y/Y Change-6%-11%0%-2%17%31%16%29%33%42%-4%23%17%15%

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% of Total9%8%8%5%6%5%6%4%6%6%6%4%5%6%7%5%5%

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SOFTWARE, SERVICE & OTHER

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Revenues$239,000$345,000$294,000$325,000$324,000$314,000$316,000$347,000$345,000$386,000$430,000$628,000$529,000$501,000$1,203,000$1,301,000$1,789,000$2,128,910$2,448,247

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Y/Y Change36%-9%7%7%6%23%36%81%53%30%8%38%19%15%

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% of Total7%10%8%6%7%7%7%5%7%7%7%7%7%7%7%6%7%

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TOTAL REVENUE$3,243,000$3,520,000$3,678,000$5,749,000$4,359,000$4,370,000$4,837,000$7,115,000$5,264,000$5,410,000$6,217,000$9,608,000$7,512,000$7,464,000$16,190,000$20,681,000$26,135,000$31,128,912$39,771,172

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REVENUE BY SEGMENTMar-05Jun-05Sep-05Dec-05Mar-06Jun-06Sep-06Dec-06Mar-07Jun-07Sep-07A

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Americas$1,443,000$1,739,000$1,771,000$2,700,000$2,122,000$2,188,000$2,297,000$3,498,000$2,447,000$2,680,000$2,928,000

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Y/Y Change47%26%30%30%15%22%27%

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% of Total44%49%48%47%49%50%47%49%46%50%47%

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Europe$705,000$742,000$779,000$1,242,000$966,000$899,000$987,000$1,711,000$1,249,000$1,160,000$1,339,000

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Y/Y Change37%21%27%38%29%29%36%

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% of Total22%21%21%22%22%21%20%24%24%21%22%

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Japan$284,000$227,000$224,000$355,000$309,000$258,000$286,000$285,000$283,000$258,000$255,000

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Y/Y Change9%14%28%-20%-8%0%-11%

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% of Total9%6%6%6%7%6%6%4%5%5%4%

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Retail$571,000$555,000$663,000$1,072,000$636,000$715,000$936,000$1,139,000$855,000$915,000$1,251,000

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Y/Y Change11%29%41%6%34%28%34%

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% of Total18%16%18%19%15%16%19%16%16%17%

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Other (Asia-Pacific and FileMaker)$240,000$257,000$241,000$380,000$326,000$310,000$331,000$482,000$430,000$397,000$444,000

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Y/Y Change36%21%37%27%32%28%34%

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% of Total7.40%7.30%6.55%6.61%7.48%7.09%6.84%6.77%8.17%7.34%7.14%

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TOTAL REVENUE$3,243,000$3,520,000$3,678,000$5,749,000$4,359,000$4,370,000$4,837,000$7,115,000$5,264,000$5,410,000$6,217,000

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CASH FLOW

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Cash Flow From Operations$283$1,165$1,813$3,774

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Y/Y Change

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% of Total

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Capital Expenditures$82$512$142$530

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Y/Y Change

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% of Revenue

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FREE CASH FLOW$0$0$0$201$0$653$0$1,671$0$3,244

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Y/Y Change

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Margin

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BALANCE SHEET

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Cash, Equivalents + Marketable Secs.$2,254$3,094$3,491$4,150$6,346$8,013$6,392$7,159$7,095$7,118$9,352

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Inventory$164$193$165$244$204$213$270$303$208$251$346

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Y/Y Change

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% of Revenue

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Debt (Current + Long-Term)$0$0$0$0$0$0$0$0$0$0$0

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VALUATION

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Price$204.44

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Shares Outstanding (Diluted)890,671

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MARKET CAPITALIZATION$182,088,779

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Market Capitalization

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+ Debt$0

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- Cash$9,352

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ENTERPRISE VALUE$182,079,427

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VALUATION RATIOS

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P/E:EPSP/E

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CY 2007E$4.5545x

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CY 2008E$5.0141x

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CY 2009E$6.5831x
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