Apple posted record revenue and earnings per share for the September quarter on Monday, even after raising prices on several popular products. Strong iPhone and Mac sales helped drive the results, which mark the first earnings report since John Ternus became CEO.
Revenue climbed 12% year over year to $114.5 billion, ahead of analysts’ expectations. Earnings per share rose 14% to $2.10, also beating forecasts. For the full fiscal year, revenue increased 15% to a record $478.8 billion.
The quarter included only eight days of sales for the iPhone 18 Pro. Ternus said customers had responded enthusiastically to the new lineup. Still, analysts have noted that the iPhone 17 had an unusually strong upgrade cycle, giving this year’s models a tough comparison. iPhone revenue grew 17% to $57.6 billion in the quarter.
Apple’s first foldable iPhone, the Duo, is also in short supply. Some customers face delivery estimates stretching into 2027, while others have struggled to find the device in stores.
“The Duo is constrained as of today,” Ternus said in an interview. He described production as progressing well and said Apple was working to get the phone to customers faster, though the company could not yet say when supply would meet demand.
Ternus, who took over from Tim Cook on Sept. 1, said the better-than-expected results came despite supply limits and unfavorable currency movements. It was his first quarterly earnings report as CEO.
Rising memory-chip costs are among Apple’s biggest pressures, partly because of growing demand from the AI industry. Some flash-memory prices have risen more than 500% since 2023, according to a Wall Street Journal report. Ternus called the disruption unprecedented. Apple’s gross margin, a key measure of profitability, was 47.9%, broadly in line with expectations.
Memory costs were higher than in the June quarter, Ternus said, but existing inventory and lower prices for some other components helped soften the impact. Apple raised prices on many Mac and iPad products in late June, and on iPhones in September, he said. Those increases helped offset higher costs.
AI is also contributing to demand for Apple products. Ternus said the Mac was having an “AI moment,” and Mac revenue jumped 24% to $10.8 billion in the September quarter. The MacBook Neo and MacBook Pro helped lift sales, despite supply constraints.
Apple sold more Macs in fiscal 2026 than in any previous fiscal year, Ternus said, setting a record for annual unit sales.
The company has introduced its iPhone 18 Pro lineup alongside an updated Siri with AI features. Ternus said early reviews had been encouraging and argued that Apple products offer a strong platform for AI. Users make more than 2.5 billion Siri requests each day, he said.
Apple has gained more than $1 trillion in market value since July, outperforming other major technology companies, including Microsoft and Nvidia. Investors appear to have welcomed its comparatively measured AI spending; unlike some competitors, Apple has not committed hundreds of billions of dollars to building AI data centers. Its shares are trading at an elevated valuation of about 35 times expected earnings.
Tariff refunds also helped the quarter, adding roughly one percentage point to gross margin and about five cents to earnings per share.
Since becoming CEO, Ternus has overseen a busy stretch of product launches, including new smart-home devices and accessories such as connected locks and doorbells, as well as Apple’s first MacBook Pro with a touchscreen.
Revenue in Greater China rose 21% to more than $17.5 billion, a record for a September quarter, though it came in below analysts’ estimates. Ternus said iPhone revenue in the region reached a quarterly record, and Mac sales grew at a strong double-digit rate.
Ternus joined Apple in 2001 and spent more than two decades at the company, most recently leading its hardware engineering group.
Apple’s market value first closed above $5 trillion on Oct. 14, making it the second company to reach that level after Nvidia. The company briefly moved ahead of Nvidia again late last week to become the world’s most valuable publicly traded company.
