Apple Inc.

Note 1 –Summary of Significant Accounting Policies

Basis of Presentation and Preparation

The consolidated financial statements include the accounts of Apple Inc. and its wholly owned subsidiaries. The preparation of these consolidated financial statements and accompanying notes in conformity with GAAP requires the use of management estimates. Certain prior period amounts in the consolidated financial statements and accompanying notes have been reclassified to conform to the current period’s presentation.

The Company’s fiscal year is the 52- or 53-week period that ends on the last Saturday of September. An additional week is included in the first fiscal quarter every five or six years to realign the Company’s fiscal quarters with calendar quarters. The Company’s fiscal years 2026, 2025 and 2024 spanned 52 weeks each. Unless otherwise stated, references to particular years, quarters, months and periods refer to the Company’s fiscal years ended in September and the associated quarters, months and periods of those fiscal years.

Recently Adopted Accounting Pronouncements

Income Taxes

Beginning with the 2026 annual reporting period, the Company adopted the FASB’s ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures(“ASU 2023-09”), which requires the Company to disclose specified additional information in its income tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. ASU 2023-09 also requires the Company to disaggregate its income taxes paid disclosure by federal, state and local, and foreign taxes, with further disaggregation required for significant individual jurisdictions. The Company adopted ASU 2023-09 using a prospective transition method.

Revenue

The Company records revenue net of taxes collected from customers that are remitted to governmental authorities.

Share-Based Compensation

The Company recognizes share-based compensation expense on a straight-line basis for its estimate of equity awards that will ultimately vest.

Cash Equivalents

All highly liquid investments with maturities of three months or less at the date of purchase are treated as cash equivalents.

Trade Receivables

Trade receivables are stated at transaction price.

Marketable Securities

The cost of securities sold is determined using the specific identification method.

Inventories

Inventories are measured using the first-in, first-out method.

Property, Plant and Equipment

Property, plant and equipment are stated at cost. Depreciation on property, plant and equipment is recognized on a straight-line basis.

Intangible Assets

Intangible assets are stated at cost.

Derivative Instruments

The Company presents derivative assets and liabilities at their gross fair values in the Consolidated Balance Sheets.

Income Taxes

The Company records certain deferred tax assets and liabilities in connection with the minimum tax on certain foreign earnings created by the TCJA.

Leases

The Company combines and accounts for lease and nonlease components as a single lease component for leases of corporate and retail facilities.

Note 2 –Revenue

The Company recognizes revenue at the amount to which it expects to be entitled when control of products or services is transferred to its customers. Control is generally transferred when the Company has a present right to payment and title and the significant risks and rewards of ownership of products or services are transferred to its customers. For most of the Company’s Products net sales, control transfers when products are shipped. For the Company’s Services net sales, control transfers over time as services are delivered. Payment for Products and Services net sales is collected within a short period following transfer of control or commencement of delivery of services, as applicable.

The Company records reductions to Products net sales related to future product returns, price protection and other customer incentive programs based on the Company’s expectations and historical experience.

For arrangements with multiple performance obligations, which represent promises within an arrangement that are distinct, the Company allocates revenue to all distinct performance obligations based on their relative stand-alone selling prices (“SSPs”). When available, the Company uses observable prices to determine SSPs. When observable prices are not available, SSPs are established that reflect the Company’s best estimates of what the selling prices of the performance obligations would be if they were sold regularly on a stand-alone basis. The Company’s process for estimating SSPs without observable prices considers multiple factors that may vary depending upon the unique facts and circumstances related to each performance obligation including, where applicable, prices charged by the Company for similar offerings, market trends in the pricing for similar offerings, product-specific business objectives and the estimated cost to provide the performance obligation.

The Company has identified the performance obligations regularly included in arrangements involving the sale of iPhone, Mac and iPad. The first material performance obligation, which represents the substantial portion of the allocated sales price, is the hardware and bundled software delivered at the time of sale. The second material performance obligation is the right to receive certain product-related bundled services, which include iCloud®, Siri and Siri AI, and Maps. The Company allocates revenue and any related discounts to all of its performance obligations based on their relative SSPs. Because the Company lacks observable prices for product-related bundled services, the allocation of revenue is based on the Company’s estimated SSPs. Revenue allocated to the delivered hardware and bundled software is recognized when control has transferred to the customer, which generally occurs when the product is shipped. Revenue allocated to product-related bundled services is deferred and recognized on a straight-line basis over the estimated period they are expected to be provided.

For certain long-term service arrangements, the Company has performance obligations for services it has not yet delivered. For these arrangements, the Company does not have a right to bill for the undelivered services. The Company has determined that any unbilled consideration relates entirely to the value of the undelivered services. Accordingly, the Company has not recognized revenue, and does not disclose amounts, related to these undelivered services.

For the sale of third-party products where the Company obtains control of the product before transferring it to the customer, the Company recognizes revenue based on the gross amount billed to customers. The Company considers multiple factors when determining whether it obtains control of third-party products, including evaluating if it can establish the price of the product, retains inventory risk for tangible products or has the responsibility for ensuring acceptability of the product. For third-party applications sold through the App Store, the Company does not obtain control of the product before transferring it to the customer. Therefore, the Company accounts for all third-party application–related sales on a net basis by recognizing in Services net sales only the commission it retains.

The following table shows disaggregated net sales, as well as the portion of total net sales that was previously deferred, for 2026, 2025 and 2024 (in millions):

(1)Services net sales include amortization of the deferred value of services bundled in the sales price of certain products.

The Company’s proportion of net sales by disaggregated revenue source was generally consistent for each reportable segment (refer to Note 14, “Segment Information and Geographic Data”) for 2026, 2025 and 2024, except in Greater China, where iPhone revenue represented a moderately higher proportion of net sales. In addition, in 2026, Services revenue represented a moderately lower proportion of net sales in Greater China.

As of September 26, 2026 and September 27, 2025, the Company had total deferred revenue of $14.8 billion and $13.7 billion, respectively. As of September 26, 2026, the Company expects 65% of total deferred revenue to be realized in less than a year,22% within one-to-two years,11% within two-to-three years and 2% in greater than three years.

Note 3 –Earnings Per Share

The following table shows the computation of basic and diluted earnings per share for 2026, 2025 and 2024 (net income in millions and shares in thousands):

Note 4 –Financial Instruments

Cash, Cash Equivalents and Marketable Securities

The following tables show the Company’s cash, cash equivalents and marketable securities by significant investment category as of September 26, 2026 and September 27, 2025 (in millions):

(1)The valuation techniques used to measure the fair values of the Company’s Level 2 financial instruments, which generally have counterparties with high credit ratings, are based on quoted market prices or model-driven valuations using significant inputs derived from or corroborated by observable market data.

As of September 26, 2026,82% of the Company’s non-current marketable debt securities other than mortgage- and asset-backed securities had maturities between 1 and 5 years,15% between 5 and 10 years, and 3% greater than 10 years. As of September 26, 2026,16% of the Company’s non-current mortgage- and asset-backed securities had maturities between 1 and 5 years,21% between 5 and 10 years, and 63% greater than 10 years.

The Company’s investments in marketable debt securities have been classified and accounted for as available-for-sale. The Company classifies marketable debt securities as either current or non-current based on each instrument’s underlying maturity.

Derivative Instruments and Hedging

The Company may use derivative instruments to partially offset its business exposure to foreign exchange and interest rate risk. However, the Company may choose not to hedge certain exposures for a variety of reasons including accounting considerations or the prohibitive economic cost of hedging particular exposures. There can be no assurance the hedges will offset more than a portion of the financial impact resulting from movements in foreign exchange or interest rates.

All derivative instruments are recorded in the Consolidated Balance Sheets at fair value. The accounting treatment for derivative gains and losses is based on intended use and hedge designation.

Gains and losses arising from amounts that are included in the assessment of cash flow hedge effectiveness are initially deferred in accumulated other comprehensive income/(loss) and subsequently reclassified into earnings when the hedged transaction affects earnings, and in the same line item in the Consolidated Statements of Operations. Gains and losses arising from amounts that are included in the assessment of fair value hedge effectiveness are recognized in the Consolidated Statements of Operations line item to which the hedge relates along with offsetting losses and gains related to the change in value of the hedged item.

For derivative instruments designated as cash flow and fair value hedges, amounts excluded from the assessment of hedge effectiveness are recognized on a straight-line basis over the life of the hedge in the Consolidated Statements of Operations line item to which the hedge relates. Changes in the fair value of amounts excluded from the assessment of hedge effectiveness are recognized in other comprehensive income/(loss).

Gains and losses arising from changes in the fair values of derivative instruments that are not designated as accounting hedges are recognized in the Consolidated Statements of Operations.

The Company classifies cash flows related to derivative instruments in the same section of the Consolidated Statements of Cash Flows as the items being hedged, which are generally classified as operating activities.

Foreign Exchange Rate Risk

To protect gross margins from fluctuations in foreign exchange rates, the Company may use forwards, options or other instruments, and may designate these instruments as cash flow hedges. The Company generally hedges portions of its forecasted foreign currency exposure associated with revenue and inventory purchases, typically for up to 12 months.

To protect the Company’s foreign currency–denominated term debt or marketable securities from fluctuations in foreign exchange rates, the Company may use forwards, cross-currency swaps or other instruments. The Company designates these instruments as either cash flow or fair value hedges. As of September 26, 2026, the maximum length of time over which the Company is hedging its exposure to the variability in future cash flows for term debt–related foreign currency transactions is 16 years.

The Company may also use derivative instruments that are not designated as accounting hedges to protect gross margins from certain fluctuations in foreign exchange rates, as well as to offset a portion of the foreign currency gains and losses generated by the remeasurement of certain assets and liabilities denominated in non-functional currencies.

Interest Rate Risk

To protect the Company’s term debt or marketable securities from fluctuations in interest rates, the Company may use interest rate swaps, options or other instruments. The Company designates these instruments as either cash flow or fair value hedges.

The notional amounts of the Company’s outstanding derivative instruments as of September 26, 2026 and September 27, 2025, were as follows (in millions):

As of September 26, 2026 and September 27, 2025, the carrying amount of the Company’scurrent and non-current term debt subject to fair value hedges was $9.2 billion and $12.6 billion, respectively.

Accounts Receivable

Trade Receivables

As of both September 26, 2026 and September 27, 2025, the Company hadone customer that represented 10% or more of total trade receivables, which accounted for 13% and 12%, respectively. The Company’s third-party cellular network carriers accounted for 33% and 34% of total trade receivables as of September 26, 2026 and September 27, 2025, respectively. The Company requires third-party credit support or collateral from certain customers to limit credit risk.

Vendor Non-Trade Receivables

The Company has non-trade receivables from certain of its manufacturing vendors resulting from the sale of components to these vendors who manufacture subassemblies or assemble final products for the Company. The Company purchases these components directly from suppliers. The Company does not reflect the sale of these components in products net sales. Rather, the Company recognizes any gain on these sales as a reduction of products cost of sales when the related final products are sold by the Company. As of September 26, 2026, the Company hadtwo vendors that individually represented 10% or more of total vendor non-trade receivables, which accounted for 45% and 27%. As of September 27, 2025, the Company hadtwo vendors that individually represented 10% or more of total vendor non-trade receivables, which accounted for 46% and 23%.

Note 5 –Property, Plant and Equipment

The following table shows the Company’s gross property, plant and equipment by major asset class and accumulated depreciation as of September 26, 2026 and September 27, 2025 (in millions):

Depreciation expense on property, plant and equipment was $8.7 billion, $8.0 billion and $8.2 billion during 2026, 2025 and 2024, respectively.

Note 6 –Intangible Assets

The following table summarizes the components of intangible asset balances as of September 26, 2026 and September 27, 2025 (in millions):

Amortization expense related to intangible assets was $4.9 billion, $3.7 billion and $3.6 billion in 2026, 2025 and 2024, respectively. The expected annual amortization expense related to intangible assets as of September 26, 2026, is as follows (in millions):

Note 7 –Consolidated Financial Statement Details

The following tables show the Company’s consolidated financial statement details as of September 26, 2026 and September 27, 2025 (in millions):

Inventories

Other Non-Current Assets

Other Current Liabilities

Note 8 –Income Taxes

European Commission State Aid Decision

On August 30, 2016, the Commission announced its decision that Ireland granted state aid to the Company by providing tax opinions in 1991 and 2007 concerning the tax allocation of profits of the Irish branches oftwo subsidiaries of the Company (“State Aid Decision”). The State Aid Decision ordered Ireland to calculate and recover additional taxes from the Company for the period June 2003 through December 2014. Irish legislative changes, effective as of January 2015, eliminated the application of the tax opinions from that date forward.

The Company and Ireland appealed the State Aid Decision to the General Court of the Court of Justice of the European Union (“General Court”). On July 15, 2020, the General Court annulled the State Aid Decision. On September 25, 2020, the Commission appealed the General Court’s decision to the European Court of Justice (“ECJ”). On September 10, 2024, the ECJ announced that it had set aside the 2020 judgment of the General Court and confirmed the Commission’s 2016 State Aid Decision. As a result, during the fourth quarter of 2024 the Company recorded a one-time income tax charge of $10.2 billion, net, which represented $15.8 billion payable to Ireland via release of amounts held in escrow, partially offset by a U.S. foreign tax credit of $4.8 billion and a decrease in unrecognized tax benefits of $823 million.

Income Before Provision for Income Taxes

Income before provision for income taxes for 2026, 2025 and 2024 consisted of the following (in millions):

Provision for Income Taxes and Effective Tax Rate

The provision for income taxes for 2026, 2025 and 2024 consisted of the following (in millions):

A reconciliation of the provision for income taxes to the amount computed by applying thestatutory federal income tax rate to income before provision for income taxes for 2026 is as follows (dollars in millions):

A reconciliation of the provision for income taxes to the amount computed by applying the statutory federal income tax rate (21% in 2025 and 2024) to income before provision for income taxes for 2025 and 2024 is as follows (dollars in millions):

Deferred Tax Assets and Liabilities

As of September 26, 2026 and September 27, 2025, the significant components of the Company’s deferred tax assets and liabilities were as follows (in millions):

As of September 26, 2026, the Company had $5.4 billion in California R&D credit carryforwards and $4.6 billion in foreign tax credit carryforwards in Ireland, both of which can be carried forward indefinitely. A valuation allowance has been recorded for the credit carryforwards and a portion of other temporary differences.

Uncertain Tax Positions

As of September 26, 2026, the total amount of gross unrecognized tax benefits was $22.5 billion, of which $10.6 billion, if recognized, would impact the Company’s effective tax rate. As of September 27, 2025, the total amount of gross unrecognized tax benefits was $23.2 billion, of which $10.6 billion, if recognized, would have impacted the Company’s effective tax rate.

The aggregate change in the balance of gross unrecognized tax benefits, which excludes interest and penalties, for 2026, 2025 and 2024 is as follows (in millions):

The Company is subject to taxation and files income tax returns in the U.S. federal jurisdiction and many state and foreign jurisd ictions. Tax years 2018 and after 2021 for the U.S. federal jurisdiction, and after 2014 in certain major foreign jurisdictions, remain subject to examination.

Cash Paid for Income Taxes

Cash paid for income taxes, net in 2026 consisted of the following (in millions):

Cash paid for income taxes, net was $43.4 billion and $26.1 billion in 2025 and 2024, respectively.

Note 9 –Leases

The Company has lease arrangements for certain equipment and facilities, including corporate, data center, manufacturing and retail space. These leases typically have original terms not exceeding 10 years and generally contain multiyear renewal options, some of which are reasonably certain of exercise.

Payments under the Company’s lease arrangements may be fixed or variable, and variable lease payments are primarily based on purchases of output of the underlying leased assets. Lease costs associated with fixed payments on the Company’s operating leases were $2.1 billion for both 2026 and 2025 and $2.0 billion for 2024. Lease costs associated with variable payments on the Company’s leases were $17.7 billion, $16.1 billion and $13.8 billion for 2026, 2025 and 2024, respectively.

The Company made fixed cash payments related to operating leases of $2.1 billion in both 2026 and 2025 and $1.9 billion in 2024. Noncash activities involving right-of-use (“ROU”) assets obtained in exchange for lease liabilities were $2.7 billion, $2.8 billion and $1.0 billion for 2026, 2025 and 2024, respectively.

The following table shows ROU assets and lease liabilities, and the associated financial statement line items, as of September 26, 2026 and September 27, 2025 (in millions):

Lease liability maturities as of September 26, 2026, are as follows (in millions):

The weighted-average remaining lease term related to the Company’s lease liabilities as of September 26, 2026 and September 27, 2025 was 9.7 years and 9.8 years, respectively. The discount rate related to the Company’s lease liabilities as of September 26, 2026 and September 27, 2025 was 3.6% and 3.4%, respectively. The discount rates related to the Company’s lease liabilities are generally based on estimates of the Company’s incremental borrowing rate, as the discount rates implicit in the Company’s leases cannot be readily determined.

As of September 26, 2026, the Company had $644 million of fixed payment obligations under additional leases, primarily for corporate facilities and retail space, that had not yet commenced. These leases are expected to commence between 2027 and 2029, with lease terms ranging from 1 year to 20 years.

Note 10 –Debt

Commercial Paper

The Company issues unsecured short-term promissory notes pursuant to a commercial paper program. The Company uses net proceeds from the commercial paper program for general corporate purposes, including dividends and share repurchases. As of September 26, 2026 and September 27, 2025, the Company had $2.0 billion and $8.0 billion of commercial paper outstanding, respectively, with maturities generally less than nine months. The weighted-average interest rate of the Company’s commercial paper was 3.80% and 4.19% as of September 26, 2026 and September 27, 2025, respectively. The following table provides a summary of cash flows associated with commercial paper for 2026, 2025 and 2024 (in millions):

Term Debt

The Company has outstanding Notes, which are senior unsecured obligations with interest payable in arrears. The following table provides a summary of the Company’s term debt as of September 26, 2026 and September 27, 2025:

To manage interest rate risk on certain of its U.S. dollar–denominated fixed-rate notes, the Company uses interest rate swaps to effectively convert the fixed interest rates to floating interest rates on a portion of these notes. Additionally, to manage foreign exchange rate risk on certain of its foreign currency–denominated notes, the Company uses cross-currency swaps to effectively convert these notes to U.S. dollar–denominated notes.

The effective interest rates for the Notes include the interest on the Notes, amortization of the discount or premium and, if applicable, adjustments related to hedging.

The future principal payments for the Company’s Notes as of September 26, 2026, are as follows (in millions):

As of September 26, 2026 and September 27, 2025, the fair value of the Company’s Notes, based on Level 2 inputs, was $64.0 billion and $80.4 billion, respectively.

Note 11 –Shareholders’ Equity

Share Repurchase Program

During 2026, the Company repurchased 297 million shares of its common stock for $85.8 billion. The Company’s share repurchase programs do not obligate the Company to acquire a minimum amount of shares. Under the programs, shares may be repurchased in privately negotiated or open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act.

Shares of Common Stock

The following table shows the changes in shares of common stock for 2026, 2025 and 2024 (in thousands):

Note 12 –Share-Based Compensation

2022 Employee Stock Plan

The Apple Inc. 2022 Employee Stock Plan (“2022 Plan”) is a shareholder-approved plan that provides for broad-based equity grants to employees, including executive officers, and permits the granting of restricted stock units (“RSUs”), stock grants, performance-based awards, stock options and stock appreciation rights. RSUs granted under the 2022 Plan generally vest over four years, based on continued employment, and are settled upon vesting in shares of the Company’s common stock on aone-for-one basis. All RSUs granted under the 2022 Plan have dividend equivalent rights, which entitle holders of RSUs to the same dividend value per share as holders of common stock. A maximum of approximately 1.3 billion shares were authorized for issuance pursuant to 2022 Plan awards at the time the plan was approved on March 4, 2022.

Restricted Stock Units

A summary of the Company’s RSU activity and related information for 2026 is as follows:

The weighted-average grant-date fair value of RSUs granted in 2025 and 2024 was $226.68 and $173.78, respectively. The Company estimates the grant-date fair value of RSUs based on the closing price of the Company’s common stock on the date of grant.

The total vesting-date fair value of RSUs was $19.3 billion, $17.1 billion and $15.8 billion for 2026, 2025 and 2024, respectively. The majority of RSUs that vested in 2026, 2025 and 2024 were net share settled such that the Company withheld shares with a value equivalent to the employees’ obligation for the applicable income and other employment taxes, and remitted cash to the appropriate taxing authorities. Total payments to taxing authorities for employees’ tax obligations were $6.9 billion, $6.1 billion and $5.6 billion in 2026, 2025 and 2024, respectively.

Share-Based Compensation

The following table shows share-based compensation expense and the related income tax benefit included in the Consolidated Statements of Operations for 2026, 2025 and 2024 (in millions):

As of September 26, 2026, the total unrecognized compensation cost related to outstanding RSUs was $24.1 billion, which the Company expects to recognize over a weighted-average period of 2.6 years.

Note 13 –Commitments, Contingencies and Supply Concentrations

Unconditional Purchase Obligations

The Company has entered into certain off–balance sheet commitments that require the future purchase of goods or services (“unconditional purchase obligations”). The Company’s unconditional purchase obligations primarily consist of supplier arrangements, distribution rights, and licensed intellectual property and content. Future payments under unconditional purchase obligations with a remaining term in excess of one year as of September 26, 2026, are as follows (in millions):

Contingencies

The Company is subject to various legal proceedings and claims that have arisen in the ordinary course of business and that have not been fully resolved. The outcome of litigation is inherently uncertain. In the opinion of management, there was not at least a reasonable possibility the Company may have incurred a material loss, or a material loss greater than a recorded accrual, concerning loss contingencies for asserted legal and other claims.

Concentrations in the Available Sources of Supply of Materials, Product and Computing Resources

Although most components essential to the Company’s business are generally available from multiple sources, certain components are currently obtained from single or limited sources. The Company also competes for various components with other participants in the markets for smartphones, personal computers, tablets, wearables and accessories. Therefore, many components used by the Company, including those that are available from multiple sources, are at times subject to industry-wide shortages and significant commodity pricing fluctuations. For example, the Company is experiencing supply constraints and rising costs driven by industry-wide supply-demand imbalances for key components, including advanced semiconductors, memory and storage. These constraints adversely affect the Company’s ability to obtain sufficient quantities of components and products on commercially reasonable terms, or at all. The Company expects these trends to intensify for memory and storage components. Restrictions on international trade can increase the cost or limit the availability of the Company’s products and the components and rare earths and other raw materials that go into them.

The Company uses some custom components that are not commonly used by its competitors, and new products introduced by the Company often utilize custom components available from only one source. When a component or product uses new technologies, initial capacity constraints may exist until the suppliers’ yields have matured or their manufacturing capacities have increased. The Company has entered into agreements for the supply of many components; however, the Company may not be able to extend or renew agreements for the supply of components on similar terms, or at all, and may not be successful in obtaining sufficient quantities from its suppliers or in a timely manner, or in identifying and obtaining sufficient quantities from an alternative source. In addition, component suppliers may fail, be subject to consolidation within a particular industry, or decide to concentrate on the production of common components instead of components customized to meet the Company’s requirements, further limiting the Company’s ability to obtain sufficient quantities of components on commercially reasonable terms, or at all.

Substantially all of the Company’s hardware products are manufactured by outsourcing partners that are located primarily in China mainland, India, Japan, South Korea, Taiwan and Vietnam.

The Company’s business, including its artificial intelligence and machine learning offerings, also depends on access to sufficient compute capacity and storage resources. Demand for cloud compute and storage services and other artificial intelligence infrastructure has increased substantially across the technology industry, resulting in constrained supply, extended lead times, and increasing costs. In addition to its own data center infrastructure, the Company relies on third-party cloud service providers to meet these compute and storage needs. There are limited third-party providers that can reliably meet such demand, and the Company may be unable to secure sufficient capacity on commercially reasonable terms, or at all, to meet customer demand.

Note 14 –Segment Information and Geographic Data

The Company manages its business primarily on a geographic basis. The Company’s CEO is its chief operating decision maker (“CODM”).

The Company’s reportable segments consist of the Americas, Europe, Greater China, Japan and Rest of Asia Pacific. Americas includes both North and South America. Europe includes European countries, as well as India, the Middle East and Africa. Greater China includes China mainland, Hong Kong and Taiwan. Rest of Asia Pacific includes Australia, New Zealand and those Asian countries not included in the Company’s other reportable segments. Although the reportable segments provide similar hardware and software products and similar services, each one is managed separately to better align with the location of the Company’s customers and distribution partners and the unique market dynamics of each geographic region.

The CODM uses segment net sales and operating income information to make certain decisions, such as product and service pricing, and to decide how to allocate resources related to sales activities and marketing investments. 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 consists of net sales to third parties, related cost of sales, and operating expenses directly attributable to the segment. The information provided to the CODM for purposes of making decisions and assessing segment performance excludes asset information.

The following tables show information byreportable segment for 2026, 2025 and 2024 (in millions):

The following tables show net sales for 2026, 2025 and 2024 and long-lived assets as of September 26, 2026 and September 27, 2025 for countries that individually accounted for 10% or more of the respective totals, as well as aggregate amounts for the remaining countries (in millions):

(1)China includes Hong Kong and Taiwan.