Apple announced its Q3 results last week, and its momentum continued into this generally quiet quarter, with revenue growth of 33% and Net Income growth of 38% YoY. Both of these were ahead of Q2, of Apple’s guidance, and of Wall Street’s consensus. However the company’s share price promptly dropped 7% on iPhone sales that fell short of Wall Street’s (inflated) expectations, and on lower than anticipated guidance for Q4. Underlying this were concerns about a slowing Chinese economy, and that Apple’s 112% YoY growth in greater China cannot be sustained. Tim Cook did not seem to agree! There has been the usual flurry of comments in the media, and as before I have gathered the numbers into a more accessible format, with my personal commentary and analysis. The last iteration again proved very popular: this one has a number of new data points, including my take on Apple Watch shipments, which is of course illuminating. Here you will find a redacted version of the slides as a taster - not all the colours are showing on Slideshare. If you would like access to the full pack, contact me on nick@aquilla-europe.com

1. Aquilla
Apple Results Q3 2015
Summary and Commentary
Note: Apple Q3 = Calendar Q2
These data are derived from results published by Apple, Inc., from the published results
of other companies, and from assorted independent analysts, as identified in the slides.
The opinions are those of the author, and should in no way be interpreted as
investment advice.

2. Aquilla
Source: Apple Results
Quarterly Revenue
Growth Accelerates
•Revenues of $49.6B
were another record for
the quarter, and
exceeded Apple’s
guidance from April
•Growth accelerated,
tipping 33% YoY, which
for a company of Apple’s
size remains remarkable
•Channel inventories
were down by 1M units,
without which revenues
would probably have
topped $50B
•These numbers dwarf
those of Google and
Microsoft. Samsung has
not yet reported its CQ2,
but seems unlikely to
catch Apple
•However guidance
midpoint for Q4 ($50B)
suggests slowing growth
(YoY 19%)
Comparative
Revenues
CQ2 2015
SamsungElectronics(CQ1)
Microsoft
Google
SamsungMobile
0%
15%
30%
45%
60%
75%
90%
0
15
30
45
60
75
90
Q1
'09
Q2
'09
Q3
'09
Q4
'09
Q1
'10
Q2
'10
Q3
'10
Q4
'10
Q1
'11
Q2
'11
Q3
'11
Q4
'11
Q1
'12
Q2
'12
Q3
'12
Q4
'12
Q1
'13
Q2
'13
Q3
'13
Q4
'13
Q1
'14
Q2
'14
Q3
'14
Q4
'14
Q1
'15
Q2
'15
Q3
'15
Q4
'15
Revenue
Growth
(%)
Revenue
(B$)
Apple Revenue
Revenue B$ Revenue YoY Growth

3. Aquilla
Source: Apple Results
Cash, Investments & Capital Return
Capital Return Program Grows
•Apple generated $15.0B of cash from
operations in the quarter, another
huge jump from the year-ago quarter
•The company returned $13.1B to
shareholders during the quarter,
mostly through Stock Repurchases
($10.0B), which offer Apple greater
flexibility than dividends
•Long and short term cash holdings
grew by $9.3B in the quarter, and the
company now has over $203B in
cash
•Cash held outside the US, for tax
reasons, is increasingly an issue:
Apple is borrowing in the US to fund
the capital return programme, while
the offshore cash approaches 90% of
the total ($181B, 89%)
0%
20%
40%
60%
80%
100%
0
20
40
60
80
100
120
140
160
180
200
220
Q1
'09
Q2
'09
Q3
'09
Q4
'09
Q1
'10
Q2
'10
Q3
'10
Q4
'10
Q1
'11
Q2
'11
Q3
'11
Q4
'11
Q1
'12
Q2
'12
Q3
'12
Q4
'12
Q1
'13
Q2
'13
Q3
'13
Q4
'13
Q1
'14
Q2
'14
Q3
'14
Q4
'14
Q1
'15
Q2
'15
Q3
'15
Q4
'15
Ex-US(B$)
Cash & Capital Return
Short Term Cash B$ Long Term Cash B$
Cash Generated B$ Capital Return B$
Non-US Held Cash %

4. Aquilla
Source: Apple Results
Revenue Mix by Product Line
iPhone dominates
•iPhone’s dominance
slipped sequentially,
but gained 10 points
YoY to 63% of the
revenues in the
quarter
•Mac increased its
share to 12% of the
mix, a very healthy
result
•iPad was the big loser,
declining a further
23%, and slipping
4th place in $ share
•Services continues to
grow, and Apple
Music can only add
to this
•Other Products ticked
up, with Apple Watch
accounting for all of
this (and more)
Most recent
$ Share $ YoY
5% 49%
10% 12%
12% 9%
9% -23%
63% 59%
iPhone M$
iPad M$
Mac M$
Services M$
Other Products M$
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Q1
'09
Q2
'09
Q3
'09
Q4
'09
Q1
'10
Q2
'10
Q3
'10
Q4
'10
Q1
'11
Q2
'11
Q3
'11
Q4
'11
Q1
'12
Q2
'12
Q3
'12
Q4
'12
Q1
'13
Q2
'13
Q3
'13
Q4
'13
Q1
'14
Q2
'14
Q3
'14
Q4
'14
Q1
'15
Q2
'15
Q3
'15
Product Line Revenue Mix
Services: iTunes, App, Mac App & iBooks Stores, AppleCare, Apple Pay, licensing, other services
Other Products: Watch, iPod, Apple TV, Beats Electronics and Apple-branded and third-party accessories

5. Aquilla
Services - Steady Gains (Music to come)
Tracking the trailing 12 months (current and 3
previous Quarters) eliminates seasonality, and
gives a better indication of the longer term trends
Source: Apple Results
Services: iTunes, App, Mac App & iBooks Stores, AppleCare, Apple Pay, licensing, other services
0
4,000
8,000
12,000
16,000
20,000
24,000
0
1,000
2,000
3,000
4,000
5,000
6,000
Q1
'09
Q2
'09
Q3
'09
Q4
'09
Q1
'10
Q2
'10
Q3
'10
Q4
'10
Q1
'11
Q2
'11
Q3
'11
Q4
'11
Q1
'12
Q2
'12
Q3
'12
Q4
'12
Q1
'13
Q2
'13
Q3
'13
Q4
'13
Q1
'14
Q2
'14
Q3
'14
Q4
'14
Q1
'15
Q2
'15
Q3
'15
Q4
'15
Trailing 12m
Revenue
($M)
Revenue
($M)
Services Revenue
Services M$ Services Trailing 12m M$

6. Aquilla
Source: Apple Results
Geo Revenue and 12m Trailing
Americas/China Ticked Up
•Trailing 12 months shows clearly
where Apple’s growth is coming from
- Americas and China
•China is still on fire, and surged past
EMEIA in 12 month trailing revenues,
as well as in the quarter
•EMEIA returned a strong quarter, and
long term trend reflects this,
continuing to climb
•APAC showed healthy growth, and
we can expect to see this reflected in
the longer term trends in the coming
1-2 quarters
Tracking the trailing 12 months (current and 3
previous Quarters) eliminates seasonality, and
gives a better indication of the longer term trends
0
20,000
40,000
60,000
80,000
100,000
Q1
'09
Q2
'09
Q3
'09
Q4
'09
Q1
'10
Q2
'10
Q3
'10
Q4
'10
Q1
'11
Q2
'11
Q3
'11
Q4
'11
Q1
'12
Q2
'12
Q3
'12
Q4
'12
Q1
'13
Q2
'13
Q3
'13
Q4
'13
Q1
'14
Q2
'14
Q3
'14
Q4
'14
Q1
'15
Q2
'15
Q3
'15
Q4
'15
Revenue
$M
Geo Revenue and 12m Trailing Revenue
APAC Japan Greater China EMEIA Americas
APAC 12m Trailing Japan 12m Trailing Greater China 12m Trailing EMEIA 12m Trailing Americas 12m Trailing

7. Aquilla
Source: Apple Results
Competitive Landscape - Tablets
Apple still leads in declining market
•Apple claimed dominance of the $200+ tablet market in
the US - several case studies were referenced, in
particular United Airlines, and the IBM partnership
talked up again
•However the next likelihood of growth will be once the
iPhone 6 comps are eliminated, most likely in Q1 2016
(which assumes the iPad was cannibalised by the larger
screen iPhones)
•Microsoft flagged strong Surface growth, though it
remains at less than 20% of iPad revenues
•Windows 10 may yet pose a threat to Apple’s enterprise
ambitions for iPad, especially as many X86 tablets are
subsidised by Intel
Source: Company Reports
0
3
6
9
12
Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015
iPad Surface
$B

8. Aquilla
Apple’s Q2 Results Analysis - Full Slide Deck

9. Aquilla
Apple’s Q3 Results Analysis
These popular slides cover an in-depth analysis of
Apple’s historic record-beating Q3 results
The slides shown are an introduction
To receive the full set, including
charts, commentary, interpretation and outlook
plus all slides in full colour
contact
Aquilla Europe
nick@aquilla-europe.com

10. Aquilla
Nick Graves, CEO • nick@aquilla-europe.com • +44 780 225 6536
Aquilla Europe Ltd • Kennett Cottage • OX9 3QS • UK • www.aquilla-europe.com