Historical teaching case · prepared as of 2026-07-20 · not maintained to track the company · educational material, not investment advice · capital at risk

AAPLApple Inc.$326·$4.79tnMIFP openimplied 7.8%base $152-53.3%

Workbench

Draft matches publish

Revenue buildup

5y growth 7.8%summary

Revenue by segment, in millions. Select a row to edit its growth path — the group row opens every segment.

Segment	FY25A	FY26	FY27	FY28	FY29	FY30	FY31	FY32	FY33	FY34	FY35	FY36	FY37	FY38	FY39	FY40	FY41	FY42	FY43	FY44	FY45	FY46	FY47	FY48	FY49	FY50	growth
Products	307,003	331,563	354,773	376,059	394,862	412,631	429,136	445,443	461,034	476,248	491,488	506,724	521,926	537,583	553,711	570,322	587,432	605,055	623,206	641,903	661,160	680,994	701,424	722,467	744,141	766,465	6.1%
Services	109,158	124,440	140,617	157,491	174,815	192,297	210,565	229,516	249,025	268,947	289,118	310,224	332,249	355,507	380,392	407,020	435,511	465,997	498,617	533,520	570,866	610,827	653,585	699,336	748,290	800,670	12.0%
Group revenue	416,161	456,003	495,390	533,550	569,677	604,928	639,701	674,959	710,059	745,195	780,606	816,947	854,175	893,090	934,103	977,342	1,022,943	1,071,052	1,121,823	1,175,423	1,232,026	1,291,822	1,355,009	1,421,803	1,492,431	1,567,135	7.8%

Operating economics

5y avg margin 34.7%summary

Operating margin, per cent of revenue. Tax and reinvestment follow below; the terminal assumptions sit on the premises panel.

Line	FY26	FY27	FY28	FY29	FY30	FY31	FY32	FY33	FY34	FY35	FY36	FY37	FY38	FY39	FY40	FY41	FY42	FY43	FY44	FY45	FY46	FY47	FY48	FY49	FY50	avg margin	Long-run
Operating margin	32.9	33.9	34.7	35.6	36.4	37.2	38.0	38.5	38.9	39.3	39.7	40.0	40.3	40.7	41.1	41.4	41.8	42.2	42.6	42.9	43.3	43.8	44.2	44.7	45.1	34.7%	45.1%

Tax & reinvestment

year-5 investment 1,939m

Cash tax as a share of operating profit; capital spend and working capital as net investment per unit of new sales — the rate the model charges against each year's revenue growth. Select a row to edit its annual path.

Line	FY26	FY27	FY28	FY29	FY30	FY31	FY32	FY33	FY34	FY35	FY36	FY37	FY38	FY39	FY40	FY41	FY42	FY43	FY44	FY45	FY46	FY47	FY48	FY49	FY50	Long-run driver
Cash tax rate	15.6%	15.7%	15.7%	15.8%	15.8%	15.9%	15.9%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%	16.0%
Capital spend	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%	2.5%
Working capital	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%	3.0%

What the assumptions imply

does not price out

Computed from the sections above and the premises panel — nothing here is editable. The walk runs to the highlighted crossover column — the first year the assumptions justify today's market price — and out to the 25-year ceiling when they never do, growing and shrinking as edits move the crossover.

Millions unless stated	FY26	FY27	FY28	FY29	FY30	FY31	FY32	FY33	FY34	FY35	FY36	FY37	FY38	FY39	FY40	FY41	FY42	FY43	FY44	FY45	FY46	FY47	FY48	FY49	FY50
Revenue
Group revenue	456,003	495,390	533,550	569,677	604,928	639,701	674,959	710,059	745,195	780,606	816,947	854,175	893,090	934,103	977,342	1,022,943	1,071,052	1,121,823	1,175,423	1,232,026	1,291,822	1,355,009	1,421,803	1,492,431	1,567,135
Revenue growth	9.6%	8.6%	7.7%	6.8%	6.2%	5.7%	5.5%	5.2%	4.9%	4.8%	4.7%	4.6%	4.6%	4.6%	4.6%	4.7%	4.7%	4.7%	4.8%	4.8%	4.9%	4.9%	4.9%	5.0%	5.0%
Operating profit
Operating profit	150,231	167,741	185,354	202,747	220,052	237,951	256,308	273,115	289,898	306,669	323,945	341,689	360,321	380,143	401,239	423,693	447,602	473,066	500,193	529,096	559,904	593,129	628,568	666,372	706,708
Operating margin	32.9%	33.9%	34.7%	35.6%	36.4%	37.2%	38.0%	38.5%	38.9%	39.3%	39.7%	40.0%	40.3%	40.7%	41.1%	41.4%	41.8%	42.2%	42.6%	42.9%	43.3%	43.8%	44.2%	44.7%	45.1%
Taxes	23,451	26,268	29,119	31,953	34,790	37,739	40,779	43,589	46,384	49,067	51,831	54,670	57,651	60,823	64,198	67,791	71,616	75,690	80,031	84,655	89,585	94,901	100,571	106,619	113,073
Operating profit after tax	126,780	141,473	156,235	170,794	185,262	200,212	215,529	229,526	243,514	257,602	272,114	287,019	302,670	319,320	337,041	355,902	375,985	397,375	420,162	444,441	470,319	498,229	527,997	559,752	593,635
Cash flow
Investment	2,191	2,166	2,099	1,987	1,939	1,913	1,939	1,930	1,932	1,948	1,999	2,048	2,140	2,256	2,378	2,508	2,646	2,792	2,948	3,113	3,289	3,475	3,674	3,885	4,109
Free cash flow	124,588	139,307	154,136	168,807	183,323	198,300	213,590	227,596	241,582	255,655	270,115	284,971	300,529	317,064	334,663	353,394	373,339	394,583	417,214	441,328	467,030	494,753	524,323	555,868	589,526
Returns	terminal return on new capital 9.3%
Reinvestment rate	1.7%	1.5%	1.3%	1.2%	1.0%	1.0%	0.9%	0.8%	0.8%	0.8%	0.7%	0.7%	0.7%	0.7%	0.7%	0.7%	0.7%	0.7%	0.7%	0.7%	0.7%	0.7%	0.7%	0.7%	0.7%
Return on new capital — incremental ROIC	—	678.3%	703.4%	732.7%	746.2%	781.7%	789.9%	725.1%	723.8%	723.4%	726.0%	728.0%	731.2%	738.1%	745.1%	752.0%	759.0%	766.0%	773.0%	779.9%	786.9%	803.1%	810.3%	817.5%	824.6%
Present value
Discounted free cash flow	113,987	116,609	118,044	118,280	117,521	116,306	114,615	111,738	108,513	105,064	101,561	98,030	94,586	91,299	88,167	85,180	82,331	79,611	77,015	74,535	72,164	69,943	67,816	65,779	63,826
Cumulative present value	113,987	230,596	348,641	466,920	584,442	700,747	815,362	927,101	1,035,614	1,140,677	1,242,238	1,340,268	1,434,854	1,526,153	1,614,319	1,699,499	1,781,830	1,861,441	1,938,456	2,012,991	2,085,155	2,155,098	2,222,915	2,288,694	2,352,520
Implied equity value	1,432,396	1,575,918	1,707,576	1,826,083	1,933,551	2,035,051	2,130,037	2,208,894	2,280,804	2,346,912	2,409,139	2,467,541	2,523,638	2,578,268	2,631,492	2,683,346	2,733,888	2,783,161	2,831,209	2,878,068	2,923,784	2,968,942	3,013,026	3,056,068	3,098,102

AAPL

Apple Inc.

Information Technology·USD·GM-3·FY2025 base·as of 2026-07-20

CompounderLow convictionChina demandMargin pressureAi cycle priced

What the market expects

MIFPOpenmodel not yet priced out

Implied growth7.8%rev CAGR priced in

Implied op margin36.4%year-5 priced in

Market price$326mcap $4.79tn

The analyst answers

Base case$152-53.3% vs mkt

Upside$226-30.9%

Downside$106-67.5%

The market

The analyst

Yours