Apple Inc. reported fiscal fourth‑quarter results that topped revenue expectations yet fell short on iPad sales and featured a softer gross‑margin outlook. The company’s shares fell about 3% in extended trading following the release of the numbers, marking the first market reaction under new chief executive John Ternus, who assumed the role on September 1.
Financial results beat revenue estimates
According to data from LSEG, Apple earned earnings per share of $2.10, surpassing the consensus estimate of $1.99. Revenue reached $114.48 billion, edging past analysts’ forecast of $113.39 billion. The company also posted a gross margin of 47.9%, a modest improvement over the 47.5% expected by the market.
Product line performance shows mixed results
Revenue by segment revealed a strong showing for the iPhone and Mac lines. iPhone sales generated $57.58 billion, beating the $56.54 billion estimate, while Mac revenue climbed to $10.79 billion, exceeding the $9.61 billion forecast. By contrast, iPad revenue fell to $6.23 billion, missing the $6.70 billion projection. Wearables, Home and Accessories delivered $8.30 billion, below the $9.06 billion expected, and “Other Products” came in at $31.57 billion, essentially matching the $31.58 billion consensus.
Guidance points to slower margin growth
During the earnings call, Apple indicated that revenue for the December quarter is expected to grow between 7% and 10% on an annual basis, compared with the 6.1% average estimate from analysts. The company’s gross‑margin outlook for the same quarter was set at 45% to 46%, trailing the 46.3% average estimate. Apple also noted that tariff refunds contributed an additional five cents to earnings per share.
The quarter’s revenue rose 12% from $102.5 billion a year earlier. Apple highlighted that iPhone revenue for the period only included eight days of sales for the new iPhone 18 Pro, and the flagship iPhone Duo was not yet available in stores before the quarter closed.
Management commentary and pricing strategy
CEO John Ternus, speaking to CNBC’s MacKenzie Sigalos, said the company had “capped off its best fiscal year ever,” adding that growth was achieved despite supply constraints and foreign‑exchange headwinds. Ternus expressed confidence in future performance, stating, “I think at this point, with everything we’ve achieved, it just feels like we’ve never been more confident that the best is yet to come.”
Ternus also explained that Apple “reluctantly” raised prices earlier in the year to offset higher component costs, noting a $100 increase across iPhone models. The company cited a global memory crunch and rising costs for computer components as factors that pressured margins. Apple said its memory costs were higher this quarter than in the June period, reinforcing the need for price adjustments.
Overall, the earnings release presented a blend of strong revenue growth, segment‑specific outperformance, and a cautious outlook on margins. Investors appeared to weigh the optimistic revenue guidance against the weaker margin forecast, resulting in the modest post‑market decline.
Helene Elliott is the Lead Science & Space Reporter at News Raise. She reports on aerospace missions, astrophysics discoveries, quantum research, and environmental technology.
