Financial Leverage and Profitability at Apple Inc from 2015 to 2024
0 viewsAbstract
This study examines the relationship between financial leverage and profitability at Apple Inc. over the 2015-2024 fiscal years. It responds to a practical corporate-finance question: whether higher use of liabilities is associated with stronger operating returns within one large technology company. The study uses annual financial-statement data reported through the U.S. Securities and Exchange Commission. Leverage is measured as total liabilities divided by total assets, while profitability is measured by return on assets using average total assets. Ten annual observations are analyzed through descriptive statistics, Pearson correlation, and simple ordinary least squares regression. Average leverage was 74.16%, and average return on assets was 20.84%. The correlation between leverage and return on assets was positive and strong (r = 0.743, p = .014). The regression produced a positive leverage coefficient of 0.438 and an R-squared of 0.552, meaning leverage was associated with about 55.2% of the observed variation in return on assets in this small sample. These findings show a statistically significant association, but they do not establish causality. Apple-specific decisions, time trends, product performance, share repurchases, and macroeconomic conditions may also explain the pattern. The study provides a transparent and reproducible example of how public accounting data can support a focused capital-structure analysis.
Keywords
Apple Inc, Capital Structure, Financial Leverage, Profitability, Return On Assets