Apple rolled into a fresh CEO era with a headline-grabbing quarter, posting record September results even after lifting prices on several major products. Strong iPhone and Mac demand carried the numbers, while supply bottlenecks, rising memory costs, and a hot AI market added tension behind the scenes.
The company’s revenue climbed 12% year over year to $114.5 billion, and earnings per share rose 14% to $2.10, both ahead of Wall Street’s expectations. That performance helped cap Apple’s strongest fiscal year yet, with annual revenue rising 15% to $478.8 billion.
The September stretch included only eight days of iPhone 18 Pro sales, yet the new phone still helped push iPhone revenue up 17% to $57.6 billion. John Ternus said Apple was thrilled with the response, even though the company is still facing the usual post-launch question: can this model really keep up with the last one?
The comparison is a tough one. Analysts had already pointed to the iPhone 17’s unusually powerful upgrade cycle, so this year’s lineup has been measured against a very high bar, not a sleepy one.
Supply remains a problem on the other side of the product mix, especially for Apple’s first foldable phone, the Duo. Delivery estimates on some orders are already stretching into 2027, and customers are still having a hard time finding units in stores.
“The Duo is constrained as of today,” Ternus said. “The ramp is going well, and we’re working really hard to get it into customers’ hands as quickly as possible.” He also made clear that Apple cannot yet say when production will fully catch up with demand.
This was Ternus’s first earnings report as CEO after taking over on Sept. 1, and he framed the quarter as strong despite “supply constraints and FX headwinds.” That combination of pressure points did not stop Apple from landing near the top of the market again, which is becoming a familiar habit.
Memory chips are one of the biggest headaches. Prices have surged as the AI buildout sucks up supply, and some flash-memory costs have reportedly soared more than 500% from 2023 levels, a brutal swing for any hardware maker.
Ternus called the situation “absolutely unprecedented,” but Apple still managed to keep gross margin at 47.9%, broadly in line with expectations. Higher memory costs were partly offset by inventory carry-in, cheaper non-memory components, and price increases across several product lines.
Those price changes matter more when the bill for components keeps climbing. Apple raised prices on Mac and iPad at the end of June, then again on iPhone in September, and those moves helped cushion the blow from the cost spike.
The AI boom is not only making Apple’s supply chain more expensive, though. It is also helping drive demand, especially for Macs, which Ternus described as entering an “AI moment.” Mac revenue jumped 24% to $10.8 billion, powered by the MacBook Neo and MacBook Pro despite tight supply.
Apple said it sold more Macs in fiscal 2026 than ever before, setting an all-time record for annual unit sales. That kind of momentum is a sharp reminder that Apple’s hardware business still has plenty of punch, even in a market obsessed with chips, models, and software promises.
The company also leaned into its AI story with a revamped Siri and the new iPhone 18 Pro lineup. Ternus said Apple is seeing “a lot of exciting advancements more broadly in the space,” and argued that its products are the best platform for AI.
He said Apple users now make more than 2.5 billion Siri requests a day, a huge number that shows how deeply the assistant is woven into daily use. The bigger challenge is turning that scale into a fresh wave of excitement without losing the polish Apple is known for.
Investors have rewarded the company for staying relatively disciplined on AI spending. Unlike some of its Silicon Valley rivals, Apple has not gone all-in on building giant AI data centers, and that restrained approach has helped the stock keep climbing.
Apple has also outpaced several of the other mega-cap tech names this year, adding more than $1 trillion in market value since July. The company briefly passed Nvidia again last week to reclaim the title of the world’s most valuable publicly traded company, and the competition at the top keeps getting tighter.
Greater China was another bright spot, with revenue rising 21% to more than $17.5 billion, a September-quarter record even though the total came in below analyst estimates. Ternus said iPhone revenue in the region also hit a September-quarter record, while Mac sales posted strong double-digit growth.
Tariff refunds added another small but useful boost, lifting gross margin by about one percentage point and increasing quarterly earnings per share by roughly 5 cents. It was one more piece of good news in a quarter that had more than enough moving parts to keep investors busy.
Ternus, who came up through Apple’s hardware engineering ranks after joining in 2001, has stepped into the role during one of the busiest product cycles in years. From foldables to AI software to touchscreen Macs, the company is pushing hard on several fronts at once, and the market is watching every move.
