Apple topped Wall Street’s targets in John Ternus’ first earnings report as chief executive, posting fiscal fourth-quarter revenue of $114.5 billion, up 12% from a year earlier, and diluted earnings of $2.10 a share. Analysts polled by LSEG had expected $113.39 billion in revenue and EPS of $1.99, CNBC reported ahead of the release.
The earnings figure carries an asterisk. Apple said the $2.10 included a favorable impact of $0.05 from tariff refunds, and its 47.9% gross margin included roughly 1 percentage point from the same source. Even without that $0.05, EPS would still have cleared the LSEG estimate. Net income for the quarter ended Sept. 26 was $30.71 billion, compared with the $29.04 billion analysts expected, according to Reuters, citing LSEG data.
iPhone and Mac lead, China trails the forecast
iPhone sales came to $57.58 billion, up from $49.03 billion a year ago, according to Apple’s condensed consolidated financial statements. That beat the $56.59 billion LSEG consensus cited by CNBC and the $56.54 billion figure Reuters reported. The quarter captured only about a week of iPhone 18 Pro and Pro Max sales, which began Sept. 18, and none from the foldable iPhone Duo, which went on sale Oct. 23.
Services, the high-margin business investors watch for durability, landed almost exactly on target. Revenue was $31.57 billion, against the $31.56 billion Reuters said analysts expected, a gain of about 10% that Reuters had flagged as the segment’s slowest pace in more than three years.
Mac revenue rose to $10.79 billion from $8.73 billion. The other hardware lines shrank: iPad fell to $6.23 billion from $6.95 billion, and Wearables, Home and Accessories slipped to $8.30 billion from $9.01 billion.
Greater China revenue climbed 21% to $17.54 billion from $14.49 billion. That is solid growth, though short of the 28% increase that Visible Alpha consensus had pointed to in an S&P Global Market Intelligence preview. The Americas brought in $48.68 billion and Europe $32.01 billion, while Japan dipped to $6.54 billion from $6.64 billion.
A record year and a cost question
“Today, Apple is proud to report a September quarter revenue record of $114.5 billion, up 12 percent from a year ago, with iPhone reaching a September quarter record and Services reaching an all-time high, capping off our best fiscal year ever,” Ternus said in the release. He pointed to the iPhone Duo, the iPhone 18 Pro models, new home hardware, touch-enabled Macs and the new Siri AI as the lineup heading into the holidays.
Fiscal 2026 revenue reached $478.8 billion, up from $416.2 billion, and full-year diluted EPS rose to $8.98 from $7.46. Chief Financial Officer Kevan Parekh said Apple generated $28 billion in operating cash flow during the quarter and returned $28 billion to shareholders. The board declared a dividend of $0.27 a share, payable Nov. 16 to holders of record as of Nov. 12.
Margins are where analysts expect pressure. Apple had told investors in the summer that September-quarter gross margin would land between 47.5% and 48%, CNBC noted, and the 47.9% result sits near the top of that range with the tariff help included. Bank of America analyst Wamsi Mohan wrote that “investor focus will likely be on component cost inflation, durability of gross margin and services revenue growth,” as memory and flash storage prices climb across the industry. Research and development spending rose to $11.73 billion from $8.87 billion a year earlier.
The release did not include a forecast for the December quarter, the period that will carry the first iPhone Duo sales. For that quarter, Visible Alpha consensus compiled by S&P Global projected $153.0 billion in total revenue and $88.9 billion from iPhone, figures Apple’s executives will be measured against on the first earnings call led by Ternus, which began at 5 p.m. ET.