Apple reported its strongest iPhone sales to date in the December quarter, driving total revenue growth of 16 percent year over year. The performance was led by the iPhone 17 lineup, with notable gains across China, India, and other global markets.
Apple reported record iPhone sales during its fiscal first quarter of 2026. (Source: Apple)
iPhone Revenue Reaches New Heights
Apple sold $85 billion worth of iPhones in the quarter, up from $69 billion in the same period last year. The increase of $16 billion represents the highest-ever quarterly iPhone revenue.
CEO Tim Cook said demand for the iPhone 17 exceeded expectations, particularly in China, where revenue surged by $7 billion compared to the previous year. He described this as the “best iPhone quarter in history in Greater China.”
The iPhone 17 lineup drove Apple’s strongest quarterly smartphone revenue to date. (Source: CNN)
In India, Apple also recorded a quarterly revenue record, supported by strong iPhone, Mac, and iPad sales. Cook emphasized that the region is now the second-largest smartphone market globally and the fourth-largest for PCs.
Total Revenue and Profit Growth
Apple posted quarterly revenue of $143.8 billion, marking a 16 percent increase compared to the previous year. Diluted earnings per share rose 19 percent to $2.84, setting a new record.
Net income reached $42 billion, up from $36 billion in the prior year. Operating cash flow totaled nearly $54 billion, enabling the company to return almost $32 billion to shareholders through dividends and share buybacks.
The growth was driven primarily by iPhone sales, but Apple also reported a record quarterly revenue for its services segment, totaling $30.01 billion, up 14 percent year over year.
Mac and Wearables See Declines
While iPhone and services performed strongly, other Apple divisions experienced lower revenue. Mac computers fell by roughly 6.7 percent, totaling $8.39 billion in sales.
Wearables, Home, and Accessories revenue dipped slightly by 2.2 percent to $11.49 billion. The decrease reflected slower demand for products, including the Apple Watch and AirPods.
iPad Performance Shows Moderate Growth
iPad revenue rose to $8.6 billion, a 6.3 percent increase from the previous year. The growth was largely supported by the M5-powered iPad Pro models.
Tim Cook noted that much of the Mac and iPad sales growth in China came from customers new to the respective product lines, signaling room for further expansion.
Strong Regional Sales in China and India
Greater China drove a substantial portion of Apple’s revenue growth during the quarter. iPhone sales in the region contributed $25.5 billion, up from $18.5 billion in the prior year.
Store traffic increased in China by strong double-digit percentages, reflecting renewed consumer engagement. Analysts noted that the iPhone ranked among the top three smartphones in urban China during the quarter.
Revenue in Greater China rose to $25.5 billion during the December quarter. (Source: The Straits Times)
In India, Apple set a quarterly revenue record across iPhone, Mac, and iPad sales. Services revenue also achieved an all-time high in the region, underscoring strong adoption across multiple product categories.
AI and Siri Partnerships
Apple has recently announced a partnership with Google to integrate the company’s Gemini AI product into future Apple AI models and updates to Siri functionality.
During the earnings call, Cook declined to provide details about the partnership. Analysts suggested that Apple is approaching AI cautiously compared to other major tech companies.
Some investment managers noted that Apple products are expected to offer seamless user experiences, which may explain the company’s measured approach to rolling out AI enhancements.
Spending and Capital Allocation
Apple plans to spend $16 billion in the coming fiscal year to expand retail stores and infrastructure. The figure is lower than Microsoft’s recent capital expenditure, which exceeded $37 billion.
The company maintained a conservative spending approach, focusing on hardware and services rather than large-scale AI investments. This strategy was highlighted as a contrast during investor discussions.
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Market Response and Stock Performance
Apple shares rose modestly following the earnings announcement, reflecting the positive reception of the iPhone sales record and overall revenue growth.
Investors continue to monitor Apple’s execution on hardware upgrades and the integration of AI into Siri. Analysts emphasized that future performance will depend on the adoption of new devices and continued engagement in key markets.
FAQs
- What were Apple’s total revenues in the first quarter of fiscal 2026?
Apple reported quarterly revenue of about $143.8 billion, representing a 16 % year-over-year increase and exceeding expectations.
- How did iPhone sales perform during the quarter?
iPhone revenue reached an all-time high of around $85 billion, up roughly 23 % compared with the same quarter last year.
- Did Apple’s profit increase in this quarter?
Yes. Apple posted net income of about $42 billion, up from roughly $36 billion in the prior year’s quarter.
- Which Apple product categories saw revenue declines?
Sales of Mac computers fell by about 6.7 %, while revenue from Wearables, Home, and Accessories dipped slightly.
- How did Apple’s services segment perform?
Apple’s services division set a revenue record of around $30 billion, reflecting double-digit growth from the previous year.
- What is Apple’s installed base of active devices?
The company now reports more than 2.5 billion active Apple devices worldwide, across all product categories.
- Did Apple comment on future revenue expectations?
Management indicated expectations for continued revenue growth in the upcoming quarter, though forecasts vary by region and product segment.
- Are there supply or cost challenges affecting Apple?
Apple acknowledged supply constraints in some product areas and noted rising component costs, especially for memory and advanced chips.
