Apple Earnings Beat Expectations as iPhone Sales Surge to Four-Year High

Apple (NASDAQ: AAPL) delivered a strong fiscal first-quarter 2026 earnings report, comfortably beating Wall Street expectations on both profit and revenue, driven by its strongest iPhone sales growth in more than four years. The results underscore Apple’s resilience amid global supply chain pressures and ongoing investor questions around its artificial intelligence strategy.

For the quarter ending December 27, 2025, Apple reported earnings of $2.84 per share on revenue of $143.76 billion, surpassing analyst forecasts of $2.68 per share and $138.40 billion in revenue. Following the announcement, Apple shares climbed 1.1% in extended trading, reflecting investor confidence in the company’s performance.

iPhone revenue surged 23.3% year over year to $85.27 billion, marking the fastest growth rate since the fourth quarter of 2021. Strong consumer demand for the newly launched iPhone 17 lineup, particularly the higher-priced Pro models, played a major role in this performance. As a result, Apple expanded its global smartphone market share to 20% in 2025, up from 18% in 2024, solidifying its leadership position in a highly competitive market.

Beyond the iPhone, Apple’s business showed mixed results. Mac sales declined 6.7% year over year to $8.39 billion, while iPad revenue rose 6.3% to $8.60 billion. The wearables, home, and accessories segment saw a modest 2.2% decline to $11.49 billion. Notably, Apple’s high-margin Services segment remained a standout performer, growing 13.9% year over year to $30.01 billion, driven by subscriptions and App Store fees.

Apple’s strong hardware performance comes despite industry-wide challenges, including an ongoing memory chip shortage highlighted by rival Samsung Electronics. The results also provide reassurance to investors amid concerns over the pace of AI monetization. Recently, Apple took a significant step in its AI strategy by partnering with Alphabet to integrate Google’s Gemini AI into Siri and other Apple Intelligence features, while also acquiring Israeli startup Q.ai.

Overall, Apple’s record-breaking quarter highlights the enduring strength of its ecosystem, the importance of Services growth, and the company’s ability to adapt its strategy as the tech landscape continues to evolve.