Strong iPhone demand and optimistic outlook lift shares
Apple reported its fourth quarter earnings on Thursday, exceeding Wall Street expectations for both earnings per share and overall revenue. The company posted EPS of $1.85 on $102.5 billion in revenue, beating forecasts of $1.77 and $102.2 billion, respectively. However, iPhone sales and Greater China revenue came in slightly below estimates.
Despite the mixed results, Apple stock rose up to 4% in after-hours trading following positive guidance from CEO Tim Cook. “We expect the December quarter’s revenue to be the best ever for the company and the best ever for iPhone,” Cook told investors. He noted that the new iPhone 17 lineup is experiencing supply constraints due to strong demand, signaling robust momentum into the next quarter.
Mixed performance across product categories
Apple’s flagship iPhone business brought in $49.03 billion, falling just short of the projected $49.3 billion. The company attributed some of this to limited availability, as the iPhone 17 models were only available for a few weeks before the quarter closed. Nonetheless, Cook expressed confidence in the product’s growth trajectory.
Other product segments delivered mixed results. The iPad division earned $6.95 billion, while Mac revenue reached $8.73 billion. Wearables, including AirPods and Apple Watch, contributed $9 billion. The Services segment performed strongly, generating $28.7 billion, ahead of analyst expectations of $28.2 billion.
China revenue lags but rebound expected
Greater China revenue was a notable weak spot, reaching $14.49 billion, well below the $16.43 billion forecast. Cook acknowledged the softness but remained optimistic, stating that Apple expects a return to growth in China in the coming quarter.
CFO Kevan Parekh highlighted Apple’s long-term strength, noting, “Our September quarter results capped off a record fiscal year, with revenue reaching $416 billion, as well as double-digit EPS growth.” He added that Apple’s active device base hit all-time highs across all categories and regions.
New iPhone models and market valuation milestones
Apple’s iPhone 17 series introduced several upgrades, including design enhancements for the Pro and Pro Max versions, and the debut of the thinner, lighter iPhone Air. The removal of the iPhone Plus signals a shift in Apple’s product strategy as it adapts to evolving consumer preferences.
Earlier this week, Apple’s market capitalization surpassed $4 trillion, placing it alongside Microsoft and Nvidia in the elite mega-cap category. While Microsoft has since dropped below that mark, Nvidia has surged past $5 trillion.
