Apple’s (AAPL) CEO Tim Cook on Q4 2014 Results – Earnings Call Transcript

Apple Inc. (NASDAQ:AAPL)

Q4 2014 Results Earnings Conference Call

October 20, 2014, 05:00 PM ET

Executives

Nancy Paxton – Senior Director of Investor Relations

Tim Cook – CEO

Luca Maestri – SVP and CFO

Analysts

Shannon Cross – Cross Research

Bill Shope – Goldman Sachs

Katy Huberty – Morgan Stanley

Toni Sacconaghi – Sanford Bernstein

Steven Milunovich – UBS

Ben Reitzes – Barclays

Gene Munster – Piper Jaffray

Keith Buckman – Bank of Montreal

Operator

Good day, everyone, and welcome to the Apple Incorporated Fourth Quarter Fiscal Year 2014 Earnings Release 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 Nancy Paxton, Senior Director of Investor Relations. Please go ahead.

Nancy Paxton – Senior Director of Investor Relations

Thank you. Good afternoon, and thanks everyone for joining us today. Speaking first today is Apple’s CEO, Tim Cook; and he will be followed by CFO, Luca Maestri, and after some final remarks we’ll open the call for questions from analysts.

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 margins, operating expenses, other income and expense, taxes and future products.

Actual results or trends could differ materially from our forecast. For more information, please refer to the risk factors discussed in Apple’s Form 10-K for 2013, the Form 10-Q for the first three quarters of fiscal 2014, 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 or information, which speak as of their respective dates.

And I’d now like to turn the call over to Tim for introductory remarks.

Tim Cook – CEO

Thanks, Nancy. Good afternoon, everyone and thanks for joining us. Since we spoke in July, it’s been an exciting and very busy time, so we have lots of great things to talk about today.

Just last month, we launched the biggest advancements in iPhone’s history with iPhone 6 and iPhone 6 Plus. These iPhones are the best we have ever created and customers absolutely love them.

Our operational team has done an extraordinary job executing the manufacturing ramp throughout the entire supply chain. Today we’ve launched in 32 countries including China and our new iPhones will be shifting in 69 countries and territories by the end of this month, making this our fastest and most successful iPhone launch ever.

Demand for the new iPhones has been staggering and geographically broad-based markedly higher in every single country where we’ve launched compared to the iPhone 5s a year ago.

We’re working hard to fill orders as fast as possible and we’re on track to be in more than 115 countries by the end of December.

Last month we introduced two new categories; the first is Apple Pay, an entirely new way to pay for things in stores and in apps. It makes mobile payments easier, more secure and more private. Apple Pay went live today and now making purchases and participating stores happens with just a touch of a finger.

Paying within apps is as easy as selecting Apple Pay and placing a finger on Touch ID. Today Apple Pay supports credit and debit cards from the three major payment networks and the top U.S. banks and over 500 additional banks have signed on and will be supporting Apple Pay beginning this year and early next year. Apple Pay is being supported by many of the nation’s top retailers and we continue to sign more retailers.

The second new category is Apple Watch, our most personal device ever and one that has already captured the world’s imagination. We can’t wait to get Apple Watch to customers beginning in early calendar 2015. We’ll be providing more details on Apple Watch as we get closer to the shipment day.

Last week we launched the new iPad Air 2 and iPad Mini 3 with innovations that make them dramatically better than previous generation and the stunning new iMac with a Retina 5K display.