1. APPLE INC

2. Apple Company Overview

3. Apple Inc. company overview DESIGNS MANUFACTURES MARKETS

4. Products and Services Macintosh “Mac” computers iPhone iPad iPod Apple TV Xserve A portfolio of consumer/professional software applications Mac OS X and iOS operating system Third-party digital content and applications through the iTunes Store Variety of accessory, service, and support offerings

5. Business Channels Retail Stores Online Stores Direct sales force and third-party cellular network carriers, wholesalers, retailers, and value-added resellers

6. Business Strategy Apple Inc is committed to bringing the best user experience to its customers through its innovative hardware, software, peripherals, services, and Internet offerings

7. Financial Analysis

9. Mac Unit Sales by Operating Segment: 2010Change2009Change2008 Americas Mac unit sales $4,97621%$4,1204%$3,980 Europe Mac unit sales 3,85936%2,84013%2,519 Japan Mac unit sales 48122%3952%389 Asia-Pacific Mac unit sales 1,50062%92617%793 Retail Mac unit sales 2,84635%2,1154%2,034 Total Mac unit sales $13,66231%$10,3967%$9,715

10. Financial Analysis Net Sales by Product:2010Change2009Change2008 Desktops (a)$4,97621%$4,1204%$3,980 Portables (b)3,85936%2,84013%2,519 Total Mac net sales48122%3952%389 iPod1,50062%92617%793 Other music related products and services (c) 2,84635%2,1154%2,034 iPhone and related products and services (d) $13,66231%$10,3967%$9,715 iPad and related products and services (e) Peripherals and other hardware (f) Software, services, and other sales (g) Total net sales

11. Fiscal Year 2010 versus 2009 Net sales during 2010 increased $22.3 billion or 52% compared to 2009. Several factors contributed positively to these increases, including the following: Net sales of iPhone and related products and services were $25.2 billion in 2010 representing an increase of $12.1 billion or 93% compared to 2009. iPhone unit sales totaled 40 million in 2010, which represents an increase of 19.3 million or 93% compared to 2009. Net sales of iPad and related products and services were $5.0 billion and unit sales of iPad were 7.5 million during 2010. Mac net sales increased by $3.6 billion or 26% in 2010 compared to 2009, and Mac unit sales increased by 3.3 million or 31% in 2010 compared to 2009. Net sales of other music related products and services increased $912 million or 23% during 2010 compared to 2009. This increase was due primarily to growth of the iTunes Store which generated total net sales of $4.1 billion for 2010. Net sales of iPods increased $183 million or 2% during 2010, while iPod unit sales declined by 7% during 2010 compared to 2009.

12. Fiscal Year 2009 versus 2008 Net sales during 2009 increased $5.4 billion or 14% compared to 2008. Several factors contributed positively to these increases, including the following: iPhone revenue and net sales of related products and services amounted to $13.0 billion in 2009, an increase of $6.3 billion or 93% compared to 2008. Net sales of other music-related products and services increased $696 million or 21% during 2009 compared to 2008. The increase was due predominantly to increased net sales of third- party digital content and applications from the iTunes Store, which experienced double-digit growth in each of the Company’s geographic segments during 2009 compared to the same period in 2008.

13. Fiscal Year 2009 versus 2008 Partially offsetting the favorable factors discussed above, net sales during 2009 were negatively impacted by certain factors, including the following: Net sales of iPods decreased $1.1 billion or 12% during 2009 compared to 2008. iPod unit sales decreased by 1% during 2009 compared to 2008. Net sales per iPod unit sold decreased 11% to $149 in 2009 compared to 2008, resulting from lower average selling prices across all of the iPod product lines, due primarily to price reductions taken with the introduction of new iPods in September 2009 and September 2008 and a stronger U.S. dollar, offset partially by a higher mix of iPod touch sales. Mac net sales declined 3% during 2009 compared to 2008, while Mac unit sales increased by 7% over the same period. Net sales per Mac unit sold decreased by 10% during 2009 compared to 2008, due primarily to lower average selling prices across all Mac portable and desktop systems and a stronger U.S. dollar.

14. Gross Margin 201020092008 Net Sales$65,225$42,905$37,491 Cost of Sales 39,541 25,683 24,294 Gross Margin$25,684$17,222$13,197 Gross Margin Percentage 39.4% 40.1% 35.2%

15. Operating Expenses 201020092008 Research & development$1,782$1,333$1,109 Percentage of net sales 2.7% 3.1% 3.0% Selling, general, & administrative$5,517$4,149$3,761 Percentage of net sales 8.5% 9.7% 10.0%

16. Other Income and Expenses 201020092008 Interest Income$311$407$653 Other income (expense), net (156) (81) (33) Total other income & expense$155$326$620

17. Apple Inc History

18. Apple Inc. History Formerly Apple Computer Inc Established in Cupertino, California on April 1, 1976 As of September 2007, the company operates about 200 retail stores in five countries and an online store where hardware and software products are sold.

19. 1976 to 1980: The early years Apple was founded on April 1, 1976 by Steve Jobs, Steve Wozniak, and Ronald Wayne (and later incorporated January 3, 1977 without Wayne, who sold his share of the company back to Jobs and Wozniak) to sell the Apple I personal computer kit. The Apple I, Apple's first product. Sold as an assembled circuit board, it lacked basic features such as a keyboard, monitor, and case. The owner of this unit added a keyboard and a wooden case. The Apple II was introduced on April 16, 1977 at the first West Coast Computer Faire. It differed from its major rivals, the TRS-80 and Commodore PET, because it came with color graphics and an open architecture. While early models used ordinary cassette tapes as storage devices, this was quickly superseded by the introduction of a 5 1/4 inch floppy disk drive and interface, the Disk II.

20. 1981 to 1989: Lisa and Macintosh The rebel from Apple's 1984 ad, set in a dystopian future modeled after the Orwell novel Nineteen Eighty-Four, set the tone for the introduction of the Macintosh The Macintosh 128K was the first Macintosh computer.

21. 1989 to 1991: The Golden Age The Macintosh Portable was Apple's first "portable" Macintosh computer, released in 1989. Apple introduced the PowerBook in 1991, which established the modern form and ergonomic layout of the laptop computer. In 1991, Apple introduced System 7, a major upgrade to the operating system which added color to the interface, and introduced a number of new networking capabilities. It would remain the architectural basis for Mac OS until 2001.

22. 1994 to 1997: Attempts at reinvention The Apple Newton was Apple's first foray into the PDA markets, as well as one of the first in the industry. In 1994 Apple allied with long-time competitor IBM and CPU maker Motorola in the so-called AIM alliance. Throughout the mid to late 1990s, Apple tried to improve its operating system's multitasking and memory management. In 1997, Apple would entered into a partnership with Microsoft to release new versions of Microsoft Office for the Macintosh as well as a US$150 million investment in non-voting Apple stock. On November 10, 1997, Apple introduced the Apple Store, an online retail store based upon the WebObjects application server the company had acquired in its purchase of NeXT.

23. 1998 to 2005: New beginnings On August 15, 1998, Apple introduced a new all-in-one Mac computer reminiscent of the original Macintosh 128K: the iMac. In 1998, Apple announced the purchase of Macromedia's Final Cut software, signaling its expansion into the digital video editing market. In 2002 Apple purchased Nothing Real for their advanced digital compositing application Shake, as well as Emagic for their music productivity application Logic. which led to the development of their consumer-level GarageBand application. On May 19, 2001, Apple opened its first official Apple Retail Stores in Virginia and California, and has since continued to open more stores in the United States and other countries. In 2003, Apple's iTunes Store was introduced, offering online music downloads for US 99¢ a song and integration with the iPod.

24. 2005-2007: The Intel partnership Apple would begin producing Intel-based Mac computers beginning in 2006. Targeted at a professional audience, the MacBook Pro (15.4" widescreen) was Apple's first laptop with an Intel microprocessor. On January 10, 2006, Apple released its first Intel chip computers, a new notebook computer known as the MacBook Pro (with a 15.4" screen) and a new (though cosmetically identical) iMac with purportedly two to three times faster performance compared with its predecessor. Both used Intel's Core Duo chip technology. On January 9, 2007 Apple Computer Inc. changed its name to Apple Inc.

25. 2005-2007 As of September 2007, Apple sells four variants of the iPod: the iPod shuffle, iPod nano, iPod classic and iPod touch. The iPod is the market leader in portable music players by a significant margin. Apple has partnered with Nike to introduce the Nike+iPod Sports Kit enabling runners to sync and monitor their runs with iTunes and the Nike+ website. iPhone is Apple's multi-touch smartphone, released on June 29, 2007 for AT&T Mobility. Apple TV, (previously known as the iTV), a set-top video device intended to bridge the sale of content from iTunes with high-definition televisions was introduced in 2007.

26. 2007–present: Post-PC era In 2008 Apple presented trackpad, which is based on the multi-touch technology. On April 3, 2010, the iPad was launched in the US and sold more than 300,000 units on that day and reaching 500,000 by the end of the first week. Apple released the fourth generation iPhone, which introduced video calling, multitasking, and a new insulated stainless steel design, which acts as the phone's antenna. Later in 2010 Apple refreshed its iPod line of MP3 players which introduced a multi-touch iPod Nano, iPod Touch with FaceTime, and iPod Shuffle with buttons which brought back the buttons of earlier generations. On January 6, 2011, the company opened their Mac App Store, a digital software distribution platform, similar to the existing iOS App Store