United states securities and exchange commission

Financial Risks
The Company expects its quarterly net sales and results of operations to fluctuate.
The Company’s profit margins vary across its products, services, geographic segments and distribution channels. For example, 
the gross margins on the Company’s products and services vary significantly and can change over time. The Company’s gross 
margins are subject to volatility and downward pressure due to a variety of factors, including: continued industry-wide global 
product pricing pressures and product pricing actions that the Company may take in response to such pressures; increased 
competition; the Company’s ability to effectively stimulate demand for certain of its products and services; compressed product 
life cycles; supply shortages; potential increases in the cost of components, outside manufacturing services, and developing, 
acquiring and delivering content for the Company’s services; the Company’s ability to manage product quality and warranty costs 
effectively; shifts in the mix of products and services, or in the geographic, currency or channel mix, including to the extent that 
regulatory changes require the Company to modify its product and service offerings; fluctuations in foreign exchange rates; 
inflation and other macroeconomic pressures; and the introduction of new products or services, including new products or 
services with higher cost structures. These and other factors could have a materially adverse impact on the Company’s results of 
operations and financial condition.
The Company has historically experienced higher net sales in its first quarter compared to other quarters in its fiscal year due in 
part to seasonal holiday demand. Additionally, new product and service introductions can significantly impact net sales, cost of 
sales and operating expenses. Further, the Company generates a significant portion of its net sales from a single product and a 
decline in demand for that product could significantly impact quarterly net sales. The Company could also be subject to 
unexpected developments, such as lower-than-anticipated demand for the Company’s products or services, issues with new 
product or service introductions, information technology system failures or network disruptions, or failure of one of the 
Company’s logistics, components supply, or manufacturing partners.
Apple Inc. | 2022 Form 10-K | 15

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