Apple Inc. (AAPL) Q4 2025 Earnings Summary

Executive Summary

Apple delivered a September-quarter record: revenue $102.47B (+8% Y/Y) and diluted EPS $1.85 (up 13% Y/Y on an adjusted basis), driven by record iPhone and record Services revenue, and stronger company gross margin of 47.2% .
Broad-based strength: iPhone $49.03B (+6% Y/Y), Mac $8.73B (+13% Y/Y), Services $28.75B (+15% Y/Y), while iPad and Wearables were roughly flat; company set regional records in the Americas, Europe, Japan, and Rest of Asia Pacific; Greater China declined 4% Y/Y due to iPhone supply constraints in the quarter .
Outlook (December quarter): total revenue expected to grow 10–12% Y/Y, iPhone to grow double-digits (best iPhone quarter ever), gross margin guided to 47–48%, OpEx $18.1–$18.5B, OI&E ≈$150M, tax ~17%; guidance includes ~$1.4B tariff costs; Services growth to be similar to FY25 pace .
Versus S&P Global consensus*, Apple posted a clean beat: revenue $102.47B vs $102.25B*, EPS $1.85 vs $1.77*, and gross margin 47.18% vs 46.47%*; upside was driven by favorable mix, Services strength, and strong early iPhone 17 demand despite supply constraints .
Strategic narrative: management emphasized Apple Intelligence and Private Cloud Compute investments (including new server manufacturing in Houston) and expects continued elevated AI-related OpEx and CapEx, while maintaining a hybrid first/third-party data center strategy .

What Went Well and What Went Wrong

What Went Well

Record Services and iPhone: Services revenue hit an all‑time high of $28.8B (+15% Y/Y) with broad-based category and geographic strength; iPhone set a September-quarter record at $49B (+6% Y/Y) with a September record for upgraders .
Margin execution: Company gross margin was 47.2%, above the high end of guidance, driven by favorable mix even with ~$1.1B tariff costs; product GM was 36.2%, services GM 75.3% .
Confidence and product cycle: CEO highlighted “our best iPhone lineup ever” (iPhone 17 family) and record fiscal-year revenue of $416B; heading into holiday, Apple expects the “best ever” December for the company and for iPhone .

Selected quotes:

“September quarter revenue record of $102.5 billion… and an all‑time revenue record for Services.” – Tim Cook
“Gross margin was 47.2%, above the high end of our guidance range… driven by favorable mix.” – CFO

What Went Wrong

Greater China softness: Greater China revenue declined 4% Y/Y, largely from iPhone; management cited supply constraints on iPhone 16 and 17 models as the primary driver; expects return to growth in December quarter .
Product category plateau in Wearables/iPad: Wearables, Home & Accessories ($9.0B) and iPad ($7.0B) were roughly flat Y/Y, facing tough comps and product timing .
Ongoing tariff headwinds: ~$1.1B September-quarter tariff costs and ~$1.4B embedded in December guidance; while China cut certain tariff rates from 20% to 10%, tariffs remain a material cost factor .

Financial Results

Headline P&L vs Prior Periods

Metric	Q4 2024	Q3 2025	Q4 2025
Revenue ($B)	$94.93	$94.04	$102.47
Diluted EPS ($)	$0.97	$1.57	$1.85
Operating Income ($B)	$29.59	$28.20	$32.43
Net Income ($B)	$14.74	$23.43	$27.47
Company Gross Margin (%)	~46.2% (calc from $43.88B/$94.93B)	46.5%	47.2%

Note: Q4 2024 EPS was depressed by a one‑time $10.2B net tax charge related to EU State Aid decision; management references adjusted Y/Y comparisons for EPS growth .

Actual vs S&P Global Consensus* (Q4 2025)

Metric	Consensus	Actual	Delta
Revenue ($B)	$102.25*	$102.47	+$0.22
Diluted EPS ($)	$1.77*	$1.85	+$0.08
Gross Margin (%)	46.47%*	47.18%	+0.71 pp

Values with asterisk (*) are retrieved from S&P Global.

Revenue by Category (Q4 2025 vs Q4 2024)

Category ($B)	Q4 2024	Q4 2025	Y/Y %
iPhone	$46.22	$49.03	+6.1%
Mac	$7.74	$8.73	+12.7%
iPad	$6.95	$6.95	~0%
Wearables, Home & Accessories	$9.04	$9.01	~0%
Services	$24.97	$28.75	+15.1%

Management color: iPhone +6% Y/Y; Mac +13% Y/Y; Services +15% Y/Y; iPad and Wearables roughly flat .

Revenue by Geography (Q4 2025 vs Q4 2024)

Geography ($B)	Q4 2024	Q4 2025	Y/Y %
Americas	$41.66	$44.19	+6.1%
Europe	$24.92	$28.70	+15.2%
Greater China	$15.03	$14.49	-3.6% (≈-4% per management)
Japan	$5.93	$6.64	+12.0%
Rest of Asia Pacific	$7.38	$8.44	+14.4%

Additional KPIs and Cash/Returns (Q4 2025)

KPI	Q4 2025
Products GM (%)	36.2%
Services GM (%)	75.3%
Operating Cash Flow ($B)	$29.7 (September record)
Tariff Costs Included	~$1.1B
Cash & Marketable Securities ($B)	$132
Total Debt ($B)	$99
Net Cash ($B)	$34
Share Repurchases ($B)	$20 (89M shares)
Dividends & Equivalents ($B)	$3.9
Dividend Declared	$0.26/share, payable Nov 13, 2025 (record Nov 10)

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Total Revenue (Y/Y)	Q1 FY26 (Dec qtr)	n/a	+10% to +12%	New
iPhone Revenue	Q1 FY26	n/a	Double-digit Y/Y growth (best iPhone quarter ever)	New
Services Revenue Growth	Q1 FY26	n/a	Similar to FY25 growth rate (+14% in FY25)	New
Gross Margin	Q1 FY26	n/a	47%–48%	New
OpEx ($B)	Q1 FY26	n/a	$18.1–$18.5	New
OI&E ($M)	Q1 FY26	n/a	≈$150	New
Tax Rate	Q1 FY26	n/a	~17%	New
Tariff Costs (included)	Q1 FY26	n/a	≈$1.4B	New
Dividend	Next payable	n/a	$0.26/share on 11/13/25	New
Gross Margin	Q4 FY25 (Sep qtr)	46%–47%	Actual 47.2%	Above high end
OpEx ($B)	Q4 FY25	$15.6–$15.8	Actual $15.9	Slightly above
Total Revenue (Y/Y)	Q4 FY25	Mid-to-high single digits	Actual +8%	In line

Notes: Management highlighted lower China tariff rates (20%→10%) in certain cases now factored into December outlook .

Earnings Call Themes & Trends

Topic	Q2 FY25 Mentions	Q3 FY25 Mentions	Q4 FY25 (Current)	Trend
AI/Apple Intelligence, Siri	Announced Apple Intelligence across platforms; more personal Siri delayed to meet quality bar; significant AI investment; hybrid data center strategy	Continued AI momentum; increased CapEx for AI; tariffs color; reiterated hybrid model	New M5 silicon powering AI; PCC servers ramping in Houston; continued elevated AI OpEx; hybrid capacity to persist	Increasing investment and deployment
Supply Chain & Tariffs	June qtr tariff cost estimate ~$900M; majority of US iPhones sourced from India; Macs/iPads/Watch from Vietnam; China remains key for RoW	Actual tariff cost ~$800M; Sep qtr est ~$1.1B; caution on extrapolation	Sep qtr included ~$1.1B; Dec guided ~$1.4B; China tariffs reduced to 10% in certain cases	Headwind persists but managed; policy easing helps at the margin
iPhone Cycle & Mix	iPhone 16e launch; upgrade records; AI features supportive	iPhone +13% Y/Y; record upgraders; strong in EM	iPhone +6% Y/Y; record Sept upgraders; early iPhone 17 demand strong; supply constraints on several models	Strong demand; near-term supply constrained
Services Momentum	All-time record; +12% Y/Y; App Store strong despite regulatory changes	All-time record; +13% Y/Y; sequential acceleration; >$100B run-rate building	All-time record; +15% Y/Y; records across categories; organic growth, not tax/one-offs	Accelerating growth and breadth
Greater China	Down 2% Y/Y; roughly flat ex-FX; subsidies supportive	Up 4% Y/Y in June; positive momentum	Down 4% Y/Y in September; supply constraints cited; expect return to growth in December	Volatile but improving outlook
Health/Watch	Hearing health features highlighted	Watch upgraders record	New health features (hypertension notifications, SleepScore) in Watch lineup	Expanding health stack

Management Commentary

Strategy and Product Strength: “We’re heading into the holiday season with a truly remarkable lineup… our best iPhone lineup ever… and an all‑time revenue record for Services” – Tim Cook .
Margins and Costs: “Company gross margin was 47.2%, above the high end of our guidance… This includes approximately $1.1B of tariff related costs” – CFO .
Guidance Tone: “We expect our December total company revenue to grow by 10% to 12% Y/Y… iPhone revenue to grow double digits… gross margin 47–48%… OpEx $18.1–$18.5B” – CFO .
AI Investments: “We are significantly increasing our investments in AI… we built Private Cloud Compute… servers manufactured in Houston ramping now” – Management .

Q&A Highlights

iPhone demand and constraints: Strong early iPhone 17 demand with constraints on several models; management not forecasting balance timing but working to fulfill orders .
China dynamics: September softness (-4% Y/Y) driven by iPhone supply constraints; store traffic up and subsidies supportive; management expects return to growth in December .
Services durability: Mid-teens growth broad-based and organic (no tax effects); advertising category (1P+3P combined) set a record, while management declined to break out search specifically .
Margins and tariffs: December GM guided up (47–48%) on favorable mix despite ~$1.4B tariffs; China tariff rates reduced in certain cases (20%→10%) temper cost drag .
OpEx/AI: Step-up in OpEx driven by R&D for AI; management maintains hybrid data center approach and continues to pursue selective M&A to accelerate the roadmap .

Estimates Context

Q4 2025 beats vs S&P Global consensus*: revenue $102.47B vs $102.25B*, EPS $1.85 vs $1.77*, gross margin 47.18% vs 46.47%* .
Implications: Better-than-expected margin execution (mix) and Services outperformance likely drive upward revisions to EPS and GM trajectory; December revenue growth color (10–12%) and iPhone double-digit guide may lift near-term Street forecasts for Q1 seasonality .