XML 52 R17.htm IDEA: XBRL DOCUMENT v3.2.0.727
Segment Information and Geographic Data
 9 Months Ended
Jun. 27, 2015
Segment Information and Geographic Data

Note 11 – Segment Information and Geographic Data

The Company reports segment information based on the “management” approach. The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of the Company’s reportable operating segments.

The Company manages its business primarily on a geographic basis. The Company’s reportable operating segments consist of the Americas, Europe, Greater China, Japan and Rest of Asia Pacific. The Americas segment includes both North and South America. The Europe segment includes European countries, as well as India, the Middle East and Africa. The Greater China segment includes China, Hong Kong and Taiwan. The Rest of Asia Pacific segment includes Australia and Asian countries, other than those countries included in the Company’s other operating segments. Each operating segment provides similar hardware and software products and similar services. The accounting policies of the various segments are the same as those described in Note 1, “Summary of Significant Accounting Policies” of the Notes to Consolidated Financial Statements in Part II, Item 8 of the 2014 Form 10-K.

The Company evaluates the performance of its operating segments based on net sales and operating income. Net sales for geographic segments are generally based on the location of customers and sales through the Company’s retail stores located in those geographic locations. Operating income for each segment includes net sales to third parties, related cost of sales and operating expenses directly attributable to the segment. Advertising expenses are generally included in the geographic segment in which the expenditures are incurred. Operating income for each segment excludes other income and expense and certain expenses managed outside the operating segments. Costs excluded from segment operating income include various corporate expenses such as R&D, corporate marketing expenses, certain share-based compensation expenses, income taxes, various nonrecurring charges and other separately managed general and administrative costs. The Company does not include intercompany transfers between segments for management reporting purposes.

The following table shows information by operating segment for the three- and nine-month periods ended June 27, 2015 and June 28, 2014 (in millions):

 

     Three Months Ended      Nine Months Ended  
     June 27,
2015		      June 28,
2014		      June 27,
2015		      June 28,
2014		  

Americas:

            

Net sales

    $ 20,209       $ 17,574       $ 72,091       $ 60,345   

Operating income

    $ 6,177       $ 5,932       $ 24,064       $ 20,030   

    

            

Europe:

            

Net sales

    $ 10,342       $ 8,659       $ 39,760       $ 33,935   

Operating income

    $ 3,275       $ 2,855       $ 13,269       $ 11,083   

Greater China:

            

Net sales

    $ 13,230       $ 6,230       $ 46,197       $ 25,561   

Operating income

    $ 5,147       $ 2,081       $ 18,227       $ 8,869   

    

            

Japan:

            

Net sales

    $ 2,872       $ 2,627       $ 11,777       $ 11,719   

Operating income

    $ 1,447       $ 1,214       $ 5,634       $ 5,376   

Rest of Asia Pacific:

            

Net sales

    $ 2,952       $ 2,342       $ 12,389       $ 9,112   

Operating income

    $ 1,154       $ 706       $ 4,603       $ 2,978   

A reconciliation of the Company’s segment operating income to the Condensed Consolidated Statements of Operations for the three- and nine-month periods ended June 27, 2015 and June 28, 2014 is as follows (in millions):

 

     Three Months Ended      Nine Months Ended  
     June 27,
2015		      June 28,
2014		      June 27,
2015		      June 28,
2014		  

Segment operating income

    $ 17,200       $ 12,788       $ 65,797       $ 48,336   

Research and development expense

      (2,034 )       (1,603 )       (5,847 )       (4,355 ) 

Other corporate expenses, net

      (1,083 )       (903 )       (3,343 )       (2,643 ) 
  

 

 

     

 

 

     

 

 

     

 

 

  

Total operating income

    $ 14,083       $ 10,282       $ 56,607       $ 41,338