Apple (NASDAQ: AAPL) posted fiscal Q4 2026 revenue of $114.477 billion, topping Wall Street expectations despite a 3% dip in after-hours trading as rising memory chip costs compressed forward profit margins. This marks the first earnings report under newly appointed Chief Executive Officer John Ternus.
The Bottom Line
- Revenue climbed 12% year-over-year to $114.477 billion for the quarter ending September 26, 2026, beating the 113.39 billion FactSet consensus.
- Gross profit margins are projected to drop to between 45% and 46% in the upcoming December quarter due to mounting component expenses and artificial intelligence deployment.
- iPhone revenue jumped 17.5% to reach $57.583 billion, fueled by high initial demand for the iPhone 18 Pro lineup.
iPhone Strength Offsets Hardware Slumps
The Cupertino-based tech giant reported net income of $30.711 billion, or $2.10 per share, representing a 12% increase compared to the $27.466 billion, or $1.85 per share, recorded in the same period last year. Analysts surveyed by FactSet had anticipated earnings of $1.99 per share on 113.39 billion in revenue. However, structural tailwinds included a tariff fee recovery that added $0.05 per share to earnings and pushed the gross margin up by one percentage point to 47.9%.
Hardware performance proved uneven across divisions. iPhone revenue rose 17.5% to $57.583 billion, and Mac sales accelerated by 24% to hit $10.792 billion. Conversely, iPad revenue declined 10.4% to $6.229 billion, while wearables, home accessories, and peripherals dropped 7.9% to $8.30 billion. Services revenue reached a record $31.573 billion, growing at 9.8%, which marked its slowest pace since 2022 amid currency headwinds and third-party licensing pressures.
| Financial Metric | Q4 2026 Actual | Q4 2025 Actual | Analyst Consensus |
|---|---|---|---|
| Diluted EPS | $2.10 | $1.85 | $1.99 |
| iPhone Revenue | $57.583 billion | 49 | 56.54 billion |
| Mac Revenue | $10.792 billion | $8.726 billion | — |
| Services Revenue | $31.573 billion | $28.75 billion | 31.58 billion |
Memory Chip Inflation Threatens Holiday Margins
Looking toward the crucial December holiday period, Apple guided for revenue growth between 7% and 10%, outpacing the 6.1% increase expected by Wall Street. Yet, executives warned that profitability will face headwinds. Increased costs for memory chips and higher expenditures tied to the rollout of Apple Intelligence are projected to pull the gross margin down to a range of 45% to 46%, missing the 46.3% consensus estimate.
The primary pressure stems directly from rising component expenses.
Capital Allocation and AI Strategy Under Ternus
Stepping into the role on September 1 following Tim Cook’s departure, CEO John Ternus has signaled a continued emphasis on hardware engineering while maintaining a conservative approach to artificial intelligence infrastructure spending. Capital expenditures for the full fiscal year declined 29% to $9 billion, contrasting sharply with the massive hundreds-of-billions-dollar data center outlays planned by competitors like Microsoft (NASDAQ: MSFT) and Alphabet (NASDAQ: GOOGL).
