Apple Inc.

Good day and welcome to the Apple Q1 Fiscal Year 2024 Earnings Conference Call. Today's call is being recorded. At this time, for opening remarks and introductions, I would like to turn the call over to Suhasini Chandra Mali, Director of Investor Relations. Please go ahead.

Thank you for joining us. Speaking first today is Apple CEO Tim Cook, and he'll be followed by CFO Luca Maestri. After that, we'll open the call to questions from analysts. Before turning the call over to Tim, I would like to remind everyone that the quarter we're reporting today included 13 weeks, whereas the quarter we reported a year ago included 14 weeks. Please note that some of the information you'll hear during our discussion today will consist of forward-looking statements including, without limitation, those regarding revenue, gross margin, operating expenses, other income and expense, taxes, capital allocation, and future business outlook, including the potential impact of macroeconomic conditions on the company's business and results of operations. These statements involve risks and uncertainties that may cause actual results or trends to differ materially from our forecast. For more information, please refer to the risk factors discussed in Apple's most recently filed annual report on Form 10-K and the Form 8-K filed with the SEC today, along with the associated press release. Apple assumes no obligation to update any forward-looking statements, which speak only as of the date they are made. I'd now like to turn the call over to Tim for introductory remarks.

Thank you, Suhasini. Good afternoon, everyone, and thanks for joining the call. Today, Apple is reporting revenue of $119.6 billion for the December quarter, up 2% from a year ago, despite having one less week in the quarter. EPS was $2.18, up 16% from a year ago, and an all-time record. We achieved revenue records across more than two dozen countries and regions, including all-time records in Europe and rest of Asia Pacific. We also continue to see strong double-digit growth in many emerging markets with all-time records in Malaysia, Mexico, the Philippines, Poland, and Turkey, as well as December quarter records in India, Indonesia, Saudi Arabia, and Chile. In services, we set an all-time revenue record with paid subscriptions growing double digits year over year. And I'm pleased to announce today that we have set a new record for our install base, which has now surpassed 2.2 billion active devices. We are announcing these results on the eve of what is sure to be an historic day as we enter the era of spatial computing. Starting tomorrow, Apple Vision Pro, the most advanced personal electronics device ever, will be available in Apple stores for customers in the U.S. with expansion to other countries later this year. Apple Vision Pro is a revolutionary device built on decades of Apple innovation and it's years ahead of anything else. Apple Vision Pro has a groundbreaking new input system and thousands of innovations and it will unlock incredible experiences for users and developers that are simply not possible on any other device. There's already so much excitement behind this product from reviewers, customers, and developers. They are praising everything from the incredible experience of watching a movie on a 100-foot screen to remarkable new machine learning capabilities like hand tracking and room mapping. We can't wait for people to experience the magic for themselves. Moments like these are what we live for at Apple. They are why we do what we do. They're why we're so inflinchingly dedicated to groundbreaking innovation and why we're so focused on pushing technology to its limits as we work to enrich the lives of our users. As we look ahead, we will continue to invest in these and other technologies that will shape the future. That includes artificial intelligence, where we continue to spend a tremendous amount of time and effort, and we're excited to share the details of our ongoing work in that space later this year. Now let's turn to the results for the December quarter, beginning with iPhone. We're proud to report that revenue came in at $69.7 billion, 6% higher than a year ago. The iPhone 15 lineup has earned glowing reviews and been embraced by customers. The iPhone 15 and iPhone 15 Plus feature a gorgeous new design with color-infused back glass and contoured edges, dynamic island, A16 bionic, and a new 48 megapixel camera system. And the iPhone 15 Pro and iPhone 15 Pro Max set the gold standard for smartphones with a beautiful and lighter titanium design, industry-leading performance with A17 Pro, and our most advanced camera system with the equivalent of seven Pro lenses and the ability to record spatial video. Features like emergency SOS and roadside assistance via satellite bring peace of mind to users when they travel, and I'm grateful for every note I've received about their life-saving impact. Turning to Mac, revenue came in at $7.8 billion, up 1% year over year, driven by the strength of our latest M3-powered MacBook Pro models, in spite of having one less week of sales. Just last week, we got to wish Mac a happy 40th birthday. When it was introduced 40 years ago, Mac changed everything, and through the years, it has done so again and again. Recently, we have been on a tremendous pace of innovation. Since the introduction of Apple Silicon in 2020, we've been proud to offer our users unmatched performance and power, along with a remarkable neural engine for artificial intelligence and machine learning. This past fall, we had an amazing launch of the latest generation of Apple Silicon for Mac, M3, M3 Pro, and M3 Max. These chips break new ground in power and performance, empowering users to do more than they ever could before, whether they're making a musical masterpiece using the latest features in Logic Pro or beating their high score in a graphics-intensive game. A favorite among students, business owners, artists, and video editors, our MacBook Pro lineup is the world's best pro notebook family. And iMac, the world's most capable and best-selling all-in-one, is now faster than ever thanks to M3. In iPad, revenue for the December quarter was $7 billion, down 25% year over year due to a difficult compare with the launch of the M2 iPad Pro and the 10th generation iPad during the December quarter last year and one last week of sales. iPad remains the most versatile, capable, and elegant tablet on the market today. It continues to be the go-to device for students, creatives and more, with customers loving iPad's incredible combination of portability and performance. Powerful apps like Final Cut Pro and Logic Pro for iPad allow video and music creators to unleash their creativity in new ways that are only possible on iPad. iPad continues to push the boundaries of what's possible on a tablet. In wearables, home, and accessories, revenue came in at $12 billion, down 11% from a year ago due to a difficult compare with the launch timing of several products in this category and the impact of the 14th week last year. Across our latest Apple Watch lineup, we're enabling and encouraging our users to live a healthier day while making Apple Watch even more intuitive to use. The new double tap gesture on Apple Watch Series 9 and Apple Watch Ultra 2 make it easier to answer calls, play and pause music, or take a photo with iPhone. I've been deeply moved by the many touching stories about how features like a regular rhythm notification and fall detection helped Apple Watch users when they needed it most. And for the first time ever, users can choose a carbon neutral option of any new Apple Watch. Meanwhile, our AirPods lineup continued to be a holiday favorite. In services, we set an all time revenue record of $23.1 billion and 11% year over year increase. Because we had one less week this quarter, this growth represents an acceleration from the September quarter. And we achieved all time revenue records across advertising, cloud services, payment services and video, as well as December quarter records in App Store and Apple Care. Across our services, we're constantly growing our offerings to give users even more to love. With the redesigned Apple TV app, we've made it easier for subscribers to enjoy all their favorite shows, movies, and sports, including Apple TV Plus hits like Masters of the Air, Monarch, and Slow Horses. We're proud to be a part of Martin Scorsese's Killers of the Flower Moon, a film that has moved audiences and earned more than 200 accolades, including Best Film of the Year from the New York Film Critics Circle, nine BAFTA nominations, a Golden Globe win, and 10 Oscar nominations, including Best Picture. Across all Apple TV Plus productions, we've now earned 2050 award nominations and 450 wins since we've introduced the service. We're also excited to have a new season of Major League Soccer kicking off this month. We're looking forward to seeing Lionel Messi return to the field and to following all of our favorite teams in what is sure to be an incredible season. and we're counting down to the Apple Music Super Bowl halftime show featuring Usher. Turning to retail, in recent months, we opened three stores, including our 100th store in Asia Pacific. Throughout the holidays, our team members pulled out all the stops to help customers find the perfect gift. And I know our US team members are especially excited to begin demoing Apple Vision Pro for our customers tomorrow. At Apple, we live and breathe innovation. We are driven to pioneer new technology that can enrich our customers' lives, and we're just as intentional about showing up with our values and being a force for good in the world. February is Black History Month, and to honor it, we've launched our new Black Unity Collection, which includes the Black Unity Sport Loop Band. This year's designs reflect a lasting commitment to working toward a more equitable world. We also continue to do essential work through our racial equity and justice initiative, and we're proud to continue providing grants to organizations that are making a real impact in the world. In recent months, we've also taken significant strides in our environmental work. We're partnering with suppliers to bring more clean energy online for Apple production. We're using more recycled materials than ever before and more energy efficient transportation than ever before. And each day we are taking more and more steps toward becoming 100% carbon neutral across all of our products by 2030. Apple is a company that has never shied away from big challenges. That's because we are grounded by a deep sense of purpose and guided by a core belief in the transformative power of innovation. And so we are optimistic about the future, confident in the long term, and as excited as we've ever been to deliver for our users like only Apple can. With that, I'll turn it over to Luca.