2016. (Round your final answers to 3 decimal places.) Year Ended Sept. 30, 2017 Year Ended Sept. 24, 2016 Apple gross margin ratio 2016. (Round your final answers to 3 decimal places.) | Year Ended Dec. 31, 2017 Year Ended Dec. 31, 2016 Google gross margin ratio September 24, 2016 Apple Inc. CONSOLIDATED BALANCE SHEETS (In millions, except number of shares which are reflected in thousands and par value) September 30, 2017 ASSETS Current assets Cash and cash equivalents 20,289 Short-term marketable securities 53,892 Accounts receivable, less allowances of $58 and $53, respectively 17,874 Inventories 4.855 Vendor non-trade receivables 17.799 Other current assets 13,936 Total current assets 128,645 Long-term marketable securities 194,714 Property, plant and equipment, net 33,783 Goodwill 5,717 Acquired intangible assets, net 2,298 Other non-current assets 10,162 Total assets 375,319 20,484 46,671 15,754 2,132 13,545 8,283 106,869 170,430 27,010 5,414 3,206 8,757 321,686 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable Accrued expenses Deferred revenue Commercial paper Current portion of long-term debt Total current liabilities Deferred revenue, non-current Long-term debt Other non-current liabilities Total liabilities Commitments and contingencies Shareholders' equity Common stock and additional paid-in capital, S0.00001 par value: 12,600,000 shares authorized: 5,126,201 and 5.336,166 shares issued and outstanding, respectively Retained earnings Accumulated other comprehensive income (loss) Total shareholders' equity Total liabilities and shareholders' equity $ See accompanying Notes to Consolidated Financial Statements. 49,049 25,744 7,548 11,977 6,496 100,814 2,836 97,207 40,415 241,272 37,294 22,027 8,080 8,105 3,500 79,006 2.930 75,427 36,074 193,437 35,867 98,330 (150) 134,047 375,319 31,251 96,364 634 128,249 321.686 September 26, 2015 233,715 140.089 93.626 Apple Inc. CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except number of shares which are reflected in thousands and per share amounts) Years ended September 30, 2017 September 24, 2016 Net sales 229,234 215,639 Cost of sales 141 OR 131,376 Gross margin 186 84,263 Operating expenses Research and development 11.581 10.045 Selling, general and administrative 15.261 14.194 Total operating expenses 26,842 24299 Operating income 61.344 0024 Other income (expense), net 2.745 1.348 Income before provision for income taxes 64 ORE 61,372 Provision for income taxes 15.738 15.685 Net income 43151 45.687 3.067 14,129 71230 1.285 72.515 19.121 9.22 Earnings per share: Basic Diluted Shares used in computing earnings per share Basic 5217.242 Diluted Cash dividends declared per share See accompanying Notes to Consolidated Financial Statements 5.470,820 5.5021 2.18 5.753.421 5.793.069 1.98 September 26, 2015 $ 53,394 224 (411) 2905 Apple Inc. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in millions) Years ended September 20, 2017 September 24, 2016 Net income $ 48,351 4 5.687 Other comprehensive income (loss); Change in foreign currency translation, net of tax effects of 5(77). 58 and 5201, respectively Change in unrealized pains/losses on derivative Instruments: Change in fair value of derivatives, net of tax benefit (expense) of S(478). SCT) and 5(441), respectively 1,315 Adjustment for net (gains) losses realized and included in net income, Act of tax expense benefit of $475, 5131 and 5630, respectively (1,477) Total change in unrealized painosies on derivative instruments, te of tax (162) (734) Change in unrealized gainvlosses on marketable securities: Change in fair value of marketable securities, net of tax benefit (expense) of $425, 5(863) and 5264, respectively (782) Adjustment for net (pains) losses realized and included in net income, net of tax expense benefit of $35, 5031), and $(32), respectively Total change in unrealized in losses on marketable securities, Det of tax (846) Total other comprehensive income (loss) Total comprehensive income 3497) (592) 1.552 (483) (784) See accompanying Notes to Consolidated Financial Statements. Apple Inc. CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (In millions, except number of shares which are reflected in thousands) Accumulated Other Common Stock and Comprehensive Total Additional Paid-In Capital Retained Income Shareholders' Shares Amount Earnings (Loss) Equity Balances as of September 27, 2014 5,866,161 $ 23,313 $ 87,152 1,082 $ 111,547 Net income 53,394 53,394 Other comprehensive income (loss) (1,427) (1,427) Dividends and dividend equivalents declared (11,627) (11,627) Repurchase of common stock (325,032) (36,026) (36,026) Share-based compensation 3,586 3,586 Common stock issued, net of shares withheld for employee taxes 37,624 (231) (609) (840) Tax benefit from equity awards, including transfer pricing adjustments 748 748 Balances as of September 26, 2015 5,578,753 $ 27,416 $ 92,284 (345) $ 119,355 Net income 45,687 45,687 Other comprehensive income (loss) 979 979 Dividends and dividend equivalents declared (12.188) (12,188) Repurchase of common stock (279,609) (29,000) (29,000) Share-based compensation 4,262 4,262 Common stock issued, net of shares withheld for employee taxes 37,022 (806) (419) (1,225) Tax benefit from equity awards, including transfer pricing adjustments 379 Balances as of September 24, 2016 5,336,166 31,251 $ 96,364 634 $ 128,249 Net income 48,351 48,351 Other comprehensive income (loss) (784) (784) Dividends and dividend equivalents declared (12.803) (12,803) Repurchase of common stock (246,496) (33,001) (33,001) Share-based compensation 4,909 Common stock issued, net of shares withheld for employee taxes 36,531 (581) (1.494) Tax benefit from equity awards, including transfer pricing adjustments 620 620 Balances as of September 30, 2017 5,126,201$ 35,867 $ 98,330 $ (150) S 134,047 379 4,909 I TI (913) See accompanying Notes to Consolidated Financial Statements, September 26, 2015 5 13.844 53,394 11.257 3.586 1,382 385 417 235) (3.735) (283) 5.001 1,042 9.05 81.266 Apple Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) Years ended September 30, 2017 September 24, 2016 Cash and cash equivalents, beginning of the year $ 20,484 $ 21.120 Operating activities Net income 48,351 45.687 Adjustments to reconcile net income to cash generated by operating activities: Depreciation and amortization 10,157 10,505 Share-based compensation expense 4,840 4,210 Deferred income tax expense 5.966 4938 Other (166) 486 Changes in operating assets and liabilities: Accounts receivable, net (2,093) 527 Inventories (2,723) 217 Vendor non-trade receivables (4.254) (51) Other current and non-current assets (5,318) 1,055 Accounts payable 9,618 1,837 Deferred revenue (626) (1.554) Other current and non-current liabilities (154) (2033) Cash generated by operating activities 63,598 65824 Investing activities: Purchases of marketable securities (159,486) (142,428) Proceeds from maturities of marketable securities 31,775 21,258 Proceeds from sales of marketable securities 94,564 90.536 Payments made in connection with business acquisitions, net (329) (297) Payments for acquisition of property, plant and equipment (12,451) (12,734) Payments for acquisition of intangible assets (344) Payments for strategic investments, net (395) (1,388) Other 220 (110) Cash used in investing activities (46,446) (45,977) Financing activities: Proceeds from issuance of common stock 555 495 Excess tax benefits from cquity awards 627 407 Payments for taxes related to net share settlement of equity awards (1,874) (1.570) Payments for dividends and dividend equivalents (12,769) (12.150) Repurchases of common stock (32.900) (29,722) Proceeds from issuance of term debi, net 28,662 24,954 Repayments of term debt (3.500) (2.500) Change in commercial paper, net 3.852 (397) Cash used in financing activities (17,347) (20,483) Increase (decrease) in cash and cash equivalents (195) (616) Cash and cash equivalents, end of the year 20.289 20.484 (166,402) 14,538 107,447 (343) (11,247) (241) (26) (56.274) 543 749 (1.499) (11.561) (35,253) 27.114 2,191 (17,716) 7,276 21.120 Supplemental cash flow disclosure: Cash paid for income taxes, net Cash paid for interest 13,252 11,5915 2,092 $ 10,444 1,316 S S 514 Asor December 31, 2017 10.715 91.156 101,871 18.336 268 3.307 124,308 7.813 680 12 383 2.692 16,747 2,672 197295 Google Inc. (Alphabet Inc.) CONSOLIDATED BALANCE SHEETS (In millions, except share and par value amounts which are reflected in thousands and par value per share amounts) As of December 31, 2016 Assets Current assets Cash and cash equivalents 12,918 Marketable securities 73,415 Total cash, cash equivalents, and marketable securities 36,333 Accounts receivable, net of allowance of $467 and 5674 14.137 Income taxes receivable, net Inventory Other current assets 4,575 Total current assets 105,408 Non-marketable investments 5,878 Deferred income taxes Property and equipment, net 34,234 Intangible assets, net Goodwill 16,468 Other non-current assets 1,819 Total assets Liabilities and Stockholders' Equity Current liabilities Accounts payable 2.041 Accrued compensation and benefits 3.976 Accrued expenses and other current liabilities 6,144 Accrued revenue share 2,942 Deferred revenue 1.099 Income taxes payable, net Total current liabilities 16,756 Long-term debt 3,935 Deferred revenue, non-current Tacone taxes payable, non-current 4.677 Deferred income taxes 226 Other long-term liabilities Total liabilities 28,461 Commitments and contingencies Stockholders' equity Convertible preferred stock, 50.001 par value per share, 100.000 shares authorized: no shares issued and outstanding Class A and Class B common stock, and Class capital stock and additional paid in capital, 0.001 par value per share: 15.000.000 shares authorized (Class A 9.000.000. Class B 3,000,000 Class C 3.000.000): 691.293 (Class A 296,992. Class B 47437 Class C 346,864) and 694,783 (Class A 298.470, Class 1 46,972, Class C 349,341) shares issued and outstanding 36,307 Accumulated other comprehensive loss (2.402) Retained earnings 105,131 Total stockholders' equity 139.036 Total liabilities and stockholders' equity 167497 3.137 4.581 10,177 3,975 1,432 202 24.183 3.969 340 12.812 400 3,059 14.793 40.247 1992) 113,247 152.502 197295 Google is part of Alphabet, but we loosely refer to Alphabet as "Googlebecause of its global familiarity and that Google provides 99% of Alphabet's $110.855 billion in reven 2016 90,272 2017 110,855 $ $ Google Inc. (Alphabet Inc.)" CONSOLIDATED STATEMENTS OF INCOME (In millions) Year Ended December 31 2015 Revenues 74,989 Costs and expenses Cost of revenues 28,164 Research and development 12,282 Sales and marketing 9,047 General and administrative 6,136 European Commission fine Total costs and expenses 55,629 Income from operations 19,360 Other income (expense), net 291 Income before income taxes 19,651 Provision for income taxes 3,303 Net income 16,348 Less: Adjustment Payment to Class C capital stockholders Net income available to all stockholders 15,826 S 35,138 13,948 10,485 6,985 66,556 23,716 434 24.150 4,672 19.478 45,583 16,625 12,893 6,872 2,736 84,709 26,146 1.047 27.193 14,531 12,662 522 19.478 S 12.662 "Google is part of Alphabet, but we loosely refer to Alphabet as "Google" because of its global familiarity and that Google provides 99% of Alphabet's $110,855 billion in revenues See accompanying notes. 2016 19,478 $ 2017 12,662 (599) 1.543 Google Inc. (Alphabet Inc.) CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In millions) Year Ended December 31 2015 Net income 16,348 $ Other comprehensive income (loss): Change in foreign currency translation adjustment (1,067) Available-for-sale investments: Change in net unrealized gains (losses) (715) Less: reclassification adjustment for net (gains) losses included in net income 208 Net change (net of tax effect of $29, 50, and $0) (507) Cash flow hedges: Change in net unrealized gains (losses) 676 Less: reclassification adjustment for net (gains) losses included in net income (1,003) Net change (net of tax effect of $115, 564, and $247) (327 Other comprehensive income (loss) (1.901) Comprehensive income $ (314) 221 (93) 307 IOS 412 (638) 93 515 (351) 164 (528) 18,950 (545) 1.410 14,072 $ "Google is part of Alphabet, but we loosely refer to Alphabet as "Google" because of its global familiarity and that Google provides 99% of Alphabet's $110,855 billion in revenues. See accompanying notes. Retained Earnings 75,066 0 0 Total Stockholders' Equity $ 103,860 664 5,151 815 (2,779) (1,780) (47) 16,348 (1.901) 120,331 12.779 853 Google Inc. (Alphabet Inc.)" CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (In millions, except share amounts which are reflected in thousands) Class A and Class B Common Stock, Class C Accumulated Capital Stock and Other Additional Paid-In Capital Comprehensive Shares Amount Income (Loss) Balance as of December 31, 2014 680,172 $ 28,767 S Common and capital stock issued 8,714 664 Stock-based compensation expense 5.151 Stock-based compensation tax benefits Tax withholding related to vesting of restricted stock units Repurchases of capital stock (2,391) Adjustment Payment to Class C capital stockholders Net income Other comprehensive loss Balance as of December 31, 2015 687,348 32,982 (1,874) Cumulative effect of accounting change 180 Common and capital stock issued 9,106 298 Stock-based compensation expense 6,700 Tax withholding related to vesting of restricted stock units (3,597) Repurchases of capital stock (5.161) (256) 0 Net income Other comprehensive loss Balance as of December 31, 2016 691,293 36,307 (2,402) Cumulative effect of accounting change Common and capital stock issued 8,652 212 Stock-based compensation expense 7,694 Tax withholding related to vesting of restricted stock units (4,373) Repurchases of capital stock (315) Sale of subsidiary shares 722 Net income Other comprehensive loss 1.410 Balance as of December 31, 2017 694,783 $ 40,247 S EMALA (992) $ (1.669) (522) 16,348 89,223 (133) 47 298 6,700 (3,437) 19.478 105,131 (15) (3,597) (3,693) 19,478 (528) 139,036 (15) 212 7,694 (4.373) (4.846) 722 12,662 1,410 152,502 (4.531) 12,662 113.247 $ "Google is part of Alphabet, but we loosely refer to Alphabet as "Google" because of its global familiarity and that Google provides 99% of Alphabet's $110.855 billion in revenues. See accompanying notes Google Inc. (Alphabet Inc.)" CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) 2015 2016 2017 16,348 $ 19,478 5 12,662 5,267 877 4,132 931 5,203 (179) 334 212 6,703 6,103 812 7.679 258 (38) 275 174 194 137 (3,768) 8,211 (2,164) (2,094) (179) (318) 203 1,597 339 43 26,572 (2.578) 3,125 312 110 1,515 593 223 36,036 731 4,891 955 390 37,091 Year Ended December 31 Operating activities Net income Adjustments: Depreciation and impairment of property and equipment Amortization and impairment of intangible assets Stock-based compensation expense Deferred income taxes Loss on marketable and non-marketable investments, net Other Changes in assets and liabilities, net of effects of acquisitions: Accounts receivable Income taxes, net Other assets Accounts payable Accrued expenses and other liabilities Accrued revenue share Deferred revenue Net cash provided by operating activities Investing activities Purchases of property and equipment Proceeds from disposals of property and equipment Purchases of marketable securities Maturities and sales of marketable securities Purchases of non-marketable investments Maturities and sales of non-marketable investments Cash collateral related to securities lending Investments in reverse repurchase agreements Acquisitions, net of cash acquired, and purchases of intangible assets Proceeds from collection of notes receivable Net cash used in investing activities Financing activities Net payments related to stock-based award activities Adjustment Payment to Class C capital stockholders Repurchases of capital stock Proceeds from issuance of debt, net of costs Repayments of debt Proceeds from sale of subsidiary shares Net cash used in financing activities Effect of exchange rate changes on cash and cash equivalents Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period (9.950) (74,368) 62,905 (2,326) 154 (350) 425 (236) (10,212) 240 (84,509) 66,895 (1.109) 494 (2,428) 450 (986) 0 (31,165) (13,184) 99 (92,195) 73.959 (1.745) 533 0 0 (287) 1.419 (31.401) (23,711) (2.375) (3.304) (4.166) (47) (1.780) 13.705 (13,728) (4,846) 4.291 (4,377) (4,225) (434) (3.693) 8,729 (10,064) 0 (8,332) (170) (3.631) 16,549 12.918 800 (8.298) 405 (1.798) 18 17 (2,203) 12918 10,715 16.549 Supplemental disclosures of cash flow Information Cash paid for taxes, net of refunds Cash paid for interest, net of amounts capitalized 3,651 96 $ S 6,191 1.643 84 $ $ Google is part of Alphabet, but we loosely refer to Alphabet as "Google" because of its global familiarity and that Google provides 99% of Alphabet's $110.855 billion in revenues See accompanying notes
