APPLE INC.-ForM 10K

Apple Inc.-Form 10k

Apple Inc.-Form 10k

A comparison of five year cumulative total return to shareholders, calculated on the basis of dividends reinvested, for the Company, the S & P 500 Composite Index ("S & P 500") and the S & P equipment (hardware) Index (the industry "Index"). The graph assumes $ 100 was invested in each of the shares of the Company, the S & P 500 Index and Industry on September 30, 2003. The data points on the graph are annual. Note that the performance of historical stock prices is not necessarily indicative of future performance stock price.

The information below for the five fiscal years ended September 27, 2008, is not necessarily indicative of future results of operations should be read in conjunction with Article 7, "Discussion and Analysis of Financial Condition and Results of Operations "and the Consolidated Financial Statements and notes related thereto included in Item 8 of this Form 10-K to understand the factors that may affect the comparability of the information presented below (in millions, except per share amounts reflected in thousands and per share amounts).

During 2007, Net sales in the Americas segment increased $ 2.2 billion, or 23% compared with 2006. The main sources of this growth were the products Mac notebooks, iMac, iPod, and sales of third party content on the iTunes Store. Sales of Mac portable products increased due to the popularity of the MacBook, introduced in May 2006 and updated in May 2007 and the MacBook Pro, introduced in January 2006 and updated in June 2007. IMac sales grew due to a Change in product mix away from desktop Mac mini and eMac suspended and the strong reception of the new iMacs introduced in August 2007. IPod sales grew due to increased demand for the iPod nano and iPod shuffle and the introduction of the iPod touch in September 2007. In 2007, the segment of America represented 48% of total company net sales compared with 49% in the same period in 2006. In 2007, USA Net sales channel education and Mac unit sales increased by 14% and 18% respectively compared with 2006. Net sales in the higher education market grew 17% during 2007 compared with 2006, while net sales in the K-12 market grew 10% during the same period.

The company is currently focused on market opportunities related to mobile communication devices like the iPhone. The mobile communications industry is highly competitive with several large competitors, well financed, and experienced. The Company faces competition from companies in mobile communications device capable of trying to imitate some features of the iPhone and applications on its own smartphones. This industry is characterized by the practice of aggressive pricing, frequent product introductions, Changes in design approaches and technologies, the rapid adoption of technological advances and competitive products and price sensitivity by consumers.

The Company's future financial condition and operating results depend substantially on the Company's ability to continue to develop and deliver innovative new products and services in each of its ...