Apple Q4 Revenue Hits Record $114.5B, Warns of Margin Pressure
SingTao · 4 SOURCESabout 2 hours ago3 MIN
Summary
Apple delivered a strong fourth-quarter performance for fiscal 2026, with revenue and earnings per share both surpassing analyst expectations despite margin concerns. The company reported record quarterly revenue of $114.48 billion for the period ending September 26, driven by robust iPhone and Mac sales . Chief Executive Officer John Ternus celebrated the results, noting that the company achieved September-quarter records for total revenue and iPhone sales . However, the stock declined 2.8% in after-hours trading as management signaled that rising memory costs will continue to weigh on profitability, with gross margin expected to drop to 45%-46% in the December quarter .
Key Points
- Apple Q4 FY2026 revenue reached $114.48 billion, up 11.7% year on year, exceeding market expectations of approximately $113.47 billion
- iPhone revenue surged 17.5% year on year to $57.58 billion, setting a new September-quarter record and beating forecasts of $56.49 billion
- Mac revenue jumped 23.7% to $10.79 billion, approximately 11% above the $9.7 billion consensus estimate
- Services revenue rose 9.8% to $31.57 billion, a new all-time quarterly record, but growth slowed from 12% in the prior quarter
- Greater China revenue of $17.54 billion grew 21% year on year but missed expectations of $18.75 billion by about 6.5%
- Management guided for Q1 FY2027 gross margin of 45%-46%, down from 47.9% in Q4, citing rising memory costs and Siri AI expenses
- Chief Financial Officer Kevan Parekh identified memory costs as the primary factor pressuring margins, with impact expected to persist for several quarters
- The company declared a dividend of $0.27 per share, payable on November 16 to shareholders of record as of November 12
Why It Matters
Apple's strong quarterly performance demonstrates the continued strength of its premium hardware ecosystem, particularly iPhone, even as the company navigates supply chain headwinds affecting the broader tech industry . For Hong Kong investors, the memory cost pressures and slowing services growth signal potential margin challenges ahead, while the weaker-than-expected China performance raises questions about Apple's competitive position in a critical market . The upcoming holiday quarter guidance suggests the company is prioritizing investment in AI capabilities and absorbing higher component costs rather than passing them to consumers, a strategy that could impact near-term profitability .
Apple's strong quarterly performance demonstrates the continued strength of its premium hardware ecosystem, particularly iPhone, even as the company navigates supply chain headwinds affecting the broader tech industry . For Hong Kong investors, the memory cost pressures and slowing services growth signal potential margin challenges ahead, while the weaker-than-expected China performance raises questions about Apple's competitive position in a critical market . The upcoming holiday quarter guidance suggests the company is prioritizing investment in AI capabilities and absorbing higher component costs rather than passing them to consumers, a strategy that could impact near-term profitability .