Apple Earnings Hit a Record $114.5 Billion, but Margins Will Dip

Apple earnings for the fiscal fourth quarter set a September-quarter record: revenue rose 12% year over year to $114.5 billion for the three months ended September 26, 2026, and diluted earnings per share climbed 14% to $2.10. Apple reported the results on November 2, but shares slipped after hours as the company guided to a lower gross margin for the holiday quarter because of rising memory costs.

Net income reached $30.7 billion, up from $27.5 billion a year earlier. For the full fiscal year 2026, revenue hit an all-time high of $478.8 billion, about 15% more than the $416.2 billion Apple booked in fiscal 2025, according to the company’s earnings release.

Apple Earnings by Product: iPhone and Mac Lead

iPhone remained the main driver. Here is how each category performed in the September quarter, based on Apple’s consolidated financial statements:

• iPhone: $57.6 billion, up about 17% from $49.0 billion, a September-quarter record.
• Mac: $10.8 billion, up about 24% from $8.7 billion.
• iPad: $6.2 billion, down about 10% from $7.0 billion.
• Wearables, Home and Accessories: $8.3 billion, down about 8% from $9.0 billion.
• Services: $31.6 billion, up 10% from $28.8 billion, an all-time high.

The quarter included the launch of the iPhone 18 Pro, iPhone 18 Pro Max and the foldable iPhone Duo. CEO John Ternus, who took over in September, called the Duo “the most transformational iPhone since the original.” Demand still runs ahead of supply, and Apple is also dealing with display complaints on early units, as we covered in our report on iPhone Duo replacement shortages.

Ternus told Reuters that only “a very small percentage” of Duo units had been returned for display issues. He added, “Duo is constrained as of today,” and said Apple cannot yet predict when supply and demand will balance.

Greater China Rebounds, Japan Slips

By region, Greater China grew about 21% to $17.5 billion, while the Americas rose 10% to $48.7 billion and Europe grew 12% to $32.0 billion. Japan was the only segment to decline, falling about 1% to $6.5 billion. Apple said it also set an all-time revenue record in India.

Gross margin came in at 47.9%. Apple noted that tariff refunds added about one percentage point to that figure and $0.05 to earnings per share. The company returned $28 billion to shareholders during the quarter and declared a dividend of $0.27 per share, payable on November 16.

Holiday Quarter Outlook: Memory Costs Squeeze Margins

For the December quarter, CFO Kevan Parekh guided to revenue growth of 7% to 10%, which Apple expects to be its biggest quarter ever, and Services growth of 8% to 9%. Gross margin is expected to fall to 45% to 46%, mainly because of higher memory prices and costs tied to the ramp of Siri AI.

That outlook explains the stock reaction. According to Reuters, Apple shares were little changed after the results but dropped as much as 4% during the conference call before paring losses to about 2%. Reuters also noted that the Services forecast fell short of the 10.7% growth analysts expected.

Memory is a growing problem across the industry. AI data centers are absorbing DRAM and NAND supply, a trend we explained in why RAM is so expensive right now, and Apple said it has taken steps to lock in supply.

What It Means for Apple Buyers

For consumers, the numbers point to tight iPhone Duo availability through the holidays and little room for price cuts, as component costs keep rising. Analysts had already trimmed their sales expectations before the launch, as noted in our earlier story on Apple’s sales downgrade ahead of the iPhone Duo launch. With most iPhone models now moving to a 2027 release, Apple’s next few quarters will depend heavily on the Pro and Duo lineup.