Apple Inc.

Good day and welcome to the Apple Q2 FY 2021 earnings conference call. Today's call is being recorded. At this time, for opening remarks and introductions, I'd like to turn the call over to Tejas Ghala, Director, Investor Relations and Corporate Finance. Please go ahead.

Thank you. Good afternoon and 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. 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 COVID-19 on the company's business results of operation. 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 10K and the Form 8K filed with the SEC today, along with the associated press release. Apple assumes no obligation to update any forward-looking statements or information which seek as of their respective dates. I'd now like to turn over the call to Tim for introductory remarks.

Thanks, Tejas. Good afternoon, everyone, and thanks for joining the call today. Apple is proud to report another strong quarter, one where we set new March quarter records for both revenue and earnings, besting our year ago revenue performance by 54%. Reflecting both the enduring ways our products have helped our users meet this moment in their own lives, as well as the optimism consumers seem to feel about better days ahead, we set new March quarter records in every geographic segment and success was broadly distributed across our product categories. Mac and services delivered all-time record results and we set new March quarter records for iPhone and wearables, home, and accessories. To provide some color on our results, let's turn to our product categories. We saw very strong performance for iPhone, which grew 66% year over year, driven by the strong popularity of the iPhone 12 family. With unmatched 5G capability, the best camera system ever in an iPhone, and advanced durability from Ceramic Shield, this family of devices is popular with both upgraders and new customers alike. And just last week, we unveiled an all-new purple finish for iPhone 12 and 12 Mini. As has been the case throughout the pandemic, iPad and Mac continue to be critically important tools for our customers. Over the past year, tens of millions of iPads and Macs have been deployed to help students learn, creators create, and to enhance remote work in all of its forms. This has helped iPad grow very strong double digits to its highest March quarter revenue in nearly a decade. On Mac, fueled by the M1, We set an all-time revenue record continuing the momentum for the product category. In fact, the last three quarters for Mac have been its three best quarters ever. Last week, both iPad and Mac took a big step forward. We debuted a radically redesigned brand new iMac designed around M1's unmatched capabilities, and we brought M1 to iPad for the first time. in a new iPad Pro with 5G capability and a liquid retina XDR display. It was a quarter of sustained strength for wearables, home, and accessories which grew by 25% year over year. Apple Watch is a global success story and the category spent March quarter records in each geographic segment thanks to strong performance from both Apple Watch Series 6 and Apple Watch SE. It's an exciting and busy period ahead for wearables, home, and accessories with the launch of the next generation Apple TV 4K and our newest accessory, AirTag. AirTag builds on the powerful and incredibly useful Find My experience, helping users privately and securely keep track of the items that matter most to them. Third party accessories and products can also make use of the Find My network, guaranteeing a great experience no matter what products you choose to use. Turning to services. We achieved growth of 27% year over year and set new records for services in each of our geographic segments. We continue to enhance and improve our current service offerings from Apple Music to Apple News while continuing to launch new services that enhance our customers' lives. Just last week, we introduced Apple Card Family, which reinvents how you can share credit cards and build credit together. We also announced Apple Podcast Subscriptions, a global marketplace for listeners to discover premium content from their favorite creators and storytellers. While we're on the topic of services, in many ways this quarter showed the unique value to customers created by Apple's belief in the deep integration of hardware, software, and services. Across our products and throughout our software ecosystem, we continue to deploy industry-leading new tools to protect users' fundamental right to privacy. In addition to the App Store privacy nutrition labels that we discussed on last quarter's call, we're proud to have launched the full implementation of app tracking transparency. This powerful yet simple idea gives users a choice over how their data is used and shared across the apps that they love and use every day. No matter what device you enjoy it from, it is a milestone period for Apple TV Plus, racking up many new award nominations and wins, including its first Oscar nominations. Ted Lasso, in particular, has been recognized with a multitude of awards and nominations, including, most recently, an AFI Program of the Year recognition, Writers' Guild of America awards, and a clean sweep at the Critics' Choice Awards. Apple TV Plus also continues to be a place where we can tell stories that matter and lift up important voices and experiences like our new upcoming content partnership with Malala or our latest original documentary special, The Year of the Earth Change, narrated by the legendary David Attenborough and released to commemorate Earth Day. This is, of course, just one example of how Apple lives its values and operationalizes the idea that to whom much is given, much is expected. To begin with our environmental efforts, Just last week, we marked a milestone Earth Day on multiple fronts. In addition to the progress we've made in our own efforts to achieve our pledge of a net zero carbon footprint by 2030 across our entire supply chain and use of our products, we're proud to play a role in the growing ripple of change taking place across the private sector. As of this month, 110 of our suppliers have joined us in our renewable energy commitment And we will bring online nearly 8 gigawatts of new clean energy, the equivalent of taking 3.4 million gas-powered vehicles off the road each year. Through Apple's $4.7 billion in green bonds and related efforts, we've supported transformative environmental projects around the world, from clean energy initiatives in China to two of the world's largest onshore wind turbines in Denmark, to a 180-acre solar project outside Reno, Nevada, and many more. We're also keenly focused on how this wave of green innovation can lead to equitably shared prosperity. Through our new $200 million restore fund, we're helping local and rural communities around the world build sustainable industries around working forests, creating opportunities, and removing up to 1 million metric tons of carbon from the atmosphere every year. And here in the United States, we started a green impact accelerator investing and supporting minority-owned businesses at the forefront of environmental fields. As we look forward to WWDC, we're taking new steps to foster, to support and foster the unmatched community of developers we work with here in the United States and around the world. I'm particularly excited about our inaugural entrepreneur camp for black founders and developers. Building on the success of our entrepreneur camp program, which we began in 2019, this program gives this profoundly innovative community of developers the chance to develop next level technical skills through hands-on technology labs and with our partners at Harlem Capital, it also shares insights and mentorship on building and scaling an app business. We were proud to announce that we have expanded and accelerated our commitment to the U.S. economy. Over the next five years, we will invest $430 billion creating 20,000 jobs in the process. The investments will support American innovation and drive economic benefits in every state, including a new North Carolina campus and job creating investments in innovative fields like Silicon Engineering and 5G technology. Looking forward, whether you're running a business or just hoping to see family again after more than a year, it's tempting at this moment to let hope about the end of the COVID-19 pandemic outstrip clear-eyed realism about the challenges we still face. In many places around the world, new waves of infections, driven by even more infectious variants of the virus, are driving new lockdowns. Instead of simply assuming that the end is in sight, we at Apple are doing our part to make it a reality. beginning with an enduring and uncompromising commitment to the health and safety of our teams and extending well beyond our walls into the communities where we work. We also want to do everything we can to connect users to lifesaving vaccinations that are in ever greater supply. Through Apple Maps, for example, we now showcase vaccine site locations here in the United States, building on our maps of testing locations in many countries around the world. It's worth remembering. for much more than financial reasons or year ago compares, just how we felt at this time last year when everything we knew had to change. Planes got grounded. Entire business districts were empty and silent. People left groceries or care packages sitting in the garage or in the hall overnight in recognition of all that we didn't know and therefore had to imagine. Thanks to researchers and scientists, doctors and nurses, Everyone who can put a strike in an arm and even just check a name off a list, we have reached new days of hopeful resolve. Our work's not done, but as I said a year ago, while we can't say for sure how many chapters are in this book, we can have confidence that the ending will be a good one. With that, I'll hand things over to Luca.