CEO Tim Cook touts record-breaking year and expanding AI push
Apple Inc. surpassed Wall Street expectations in its latest quarterly earnings report, posting a net profit of $27.5 billion and revenue of $102.5 billion, driven primarily by strong growth in its services segment and steady iPhone demand.
The results, which beat analysts’ forecasts, come despite a slowdown in China and an estimated $1.1 billion hit from U.S. tariffs.
“Apple is very proud to report a September quarter revenue record,” CEO Tim Cook said in a statement, adding that the company achieved an all-time revenue record of $416 billion for the fiscal year.
Apple’s stock rose more than 2% in after-hours trading following the earnings announcement.
iPhone sales steady, services shine
Sales of Apple’s flagship iPhones totaled $49 billion, slightly below market expectations but up from the same quarter last year. Analysts described the performance as “encouraging” given the successful iPhone 17 lineup launch in September.
Meanwhile, Apple’s services division — which includes digital content, App Store, iCloud, and subscription services — brought in a record $28.8 billion, up $3 billion year-over-year.
“The services business was the standout performer,” said CFRA Research vice president Angelo Zino, noting the segment’s continued growth across all geographic regions.
Apple leans into AI and custom silicon
Cook emphasized Apple’s increasing investment in artificial intelligence, particularly through the company’s proprietary Apple silicon chips, which power most of its devices.
“At the heart of it all is Apple silicon,” Cook said. “These incredibly advanced chips make Apple products the very best place to experience the power of AI.”
He highlighted new “Apple Intelligence” features, including real-time language translation during calls and plans to introduce a more personalized Siri in 2026.
Challenges in China, tariff impact, and outlook
While Apple continues to face challenges in China, where quarterly sales dipped slightly, Cook expressed optimism that demand would recover in the current quarter as iPhone 16 and 17 models become more widely available.
“I couldn’t be more pleased with how things are going in China,” Cook said, attributing shortfalls to limited supply rather than weak demand.
Apple’s Chief Financial Officer Kevan Parekh confirmed that gross margins remained above expectations despite tariff-related costs totaling nearly $2 billion across the past two quarters.
Despite keeping prices for the new iPhone models unchanged from last year, analysts say Apple’s profitability remains resilient thanks to its high-margin services business and efficient supply chain.
Record-breaking fiscal year and strong outlook
Apple reported record-breaking annual revenue of $416 billion, bolstered by strong hardware and services sales.
Cook said he expects the current fiscal quarter to be Apple’s best ever, as the company prepares for the holiday season and a broader rollout of AI-powered features.
“As we continue to expand our investment in AI, we’re bringing intelligence to more of what people already love about our products and services,” Cook said.
