Apple (NASDAQ:AAPL) reported fiscal fourth-quarter revenue of $114.5 billion, up 12% from a year earlier and a September-quarter record, as iPhone and Mac sales posted double-digit growth. CEO John Ternus, speaking on his first earnings call as chief executive, said the results helped deliver Apple’s best fiscal year for revenue and earnings per share.
For the full fiscal year ended Sept. 26, Apple reported revenue of $478.8 billion, up 15% year over year, and earnings per share of $8.98, up 20%, according to Chief Financial Officer Kevan Parekh.
iPhone and Mac Drive Product Growth
iPhone revenue rose 17% to $57.6 billion in the September quarter despite supply constraints and foreign-exchange headwinds. Ternus said Apple posted September-quarter iPhone revenue records in the U.S. and Greater China, while also setting a record for upgraders globally.
The company recently introduced the iPhone Duo foldable device, alongside the iPhone 18 Pro and iPhone 18 Pro Max. Ternus described the Duo as “the most transformational iPhone since the original,” while noting that demand has exceeded available supply.
Chief Operating Officer Sabih Khan said the iPhone Duo ramp is progressing well but that Apple could not predict when supply and demand would come into balance.
Mac revenue increased 24% to $10.8 billion, supported by MacBook Neo and MacBook Pro demand. Apple said it experienced double-digit Mac growth in both developed and emerging markets and achieved a September-quarter record for customers new to the Mac.
By contrast, iPad revenue fell 10% to $6.2 billion, which Parekh attributed to supply constraints and a challenging comparison with the prior-year launch of an A16-powered iPad. Wearables, home and accessories revenue declined 8% to $8.3 billion, reflecting difficult comparisons against the prior-year launches of the Watch SE 3 and AirPods Pro 3.
Services Hits Record, With AI Monetization Opportunities Ahead
Services revenue reached an all-time high of $31.6 billion, up 10% year over year. Apple cited all-time revenue records in video, cloud services, payment services and advertising, as well as a September-quarter record in music.
The company said its installed base exceeded 2.5 billion active devices, while paid subscriptions surpassed 1.5 billion. Both transacting accounts and paid accounts reached records during the quarter.
Ternus said Apple sees further opportunity in iCloud+ and Apple Intelligence. The company expanded iCloud+ plans that include Apple TV and Apple Arcade to more than 100 countries and regions. He also said users needing greater capacity for server-side AI features, including Siri AI and intelligent photo editing, will be able to purchase expanded access in the future.
Apple launched Siri AI in beta for U.S. English users in September and added French, Japanese, Korean, Portuguese and Spanish in October. Ternus said the service is currently primarily request-based but uses an orchestrator-driven architecture intended to support broader capabilities over time.
“We think fundamentally, what is most important to us is that we are giving people these capabilities that are private and secure,” Ternus said in response to a question about competition in consumer AI agents.
Memory Costs and Supply Constraints Pressure Margins
Apple reported gross margin of 47.9% for the September quarter, including an approximately one-percentage-point benefit from tariff refunds. Products gross margin was 37.2%. Excluding tariff refunds from both the June and September quarters, company and products gross margins each declined about one percentage point sequentially, primarily due to higher memory costs, Parekh said.
Apple received the vast majority of tariff refunds related to tariffs previously paid, according to the CFO. Net income totaled $30.7 billion, while diluted earnings per share rose 14% to $2.10. EPS included a $0.05 favorable impact from tariff refunds.
Ternus characterized current memory pricing as “unprecedented” and said the company expects costs to continue increasing beyond the December quarter. Apple raised prices on certain Mac and iPad products at the end of June and on iPhones in September, moves that executives said provided some offset to component-cost pressure.
Khan said September-quarter supply constraints for iPhone, Mac and iPad were driven by high demand and limited availability of advanced manufacturing nodes used for Apple’s system-on-chip products. He said those advanced-node constraints are easing as Apple shifts more products to 2-nanometer technology. However, Apple expects Mac and iPad constraints in the December quarter, primarily because of memory availability amid stronger-than-expected demand.
Apple’s manufacturing purchase obligations increased by $33 billion from June to September as it worked to improve supply, executives said.
December-Quarter Outlook
For the December quarter, Apple forecast total company revenue growth of 7% to 10% year over year, assuming tariff policies remain in place and macroeconomic conditions do not worsen. Parekh said the company expects the period to be its best quarter for revenue in its history, though the outlook reflects constrained supply.
- Services revenue growth of 8% to 9% year over year.
- Gross margin between 45% and 46%, pressured primarily by higher memory costs and costs associated with the Siri AI rollout.
- Operating expenses of $20.4 billion to $20.8 billion, reflecting continued research and development investment, particularly in AI.
- A tax rate of about 17% and other income and expense of roughly $300 million, excluding potential mark-to-market effects from minority investments.
Apple ended the quarter with $137 billion in cash and marketable securities and $80 billion in total debt. It returned $28 billion to shareholders during the quarter, including $24 billion in share repurchases and $3.9 billion in dividends and equivalents. The board declared a cash dividend of $0.27 per share, payable Nov. 16 to shareholders of record as of Nov. 12.
About Apple (NASDAQ:AAPL)
Apple Inc designs, develops and sells consumer electronics, software and digital services. Its best-known products include the iPhone smartphone, Mac personal computers, iPad tablets, Apple Watch, AirPods and other accessories. The company also develops operating systems and applications that support its hardware ecosystem.
Apple’s services business includes the App Store, Apple Music, Apple TV, Apple Arcade, iCloud, Apple Pay and other subscription, payment and digital-content offerings.
