Apple opened the year with a bang: fiscal Q1 revenue hit $143.8 billion, up 16% year‑over‑year, while diluted earnings per share rose to $2.84 — a 19% jump that set an all‑time EPS record.
The headline here is simple and loud: iPhone demand was “staggering,” in CEO Tim Cook’s words, and it pushed the device’s revenue to an all‑time high. Apple also told investors its installed base of active devices has topped 2.5 billion, a metric Wall Street watches because it feeds recurring Services revenue and keeps customers inside Apple’s ecosystem.
The numbers that mattered
- Revenue: $143.8 billion (up 16% YoY)
- EPS: $2.84 (up 19% YoY)
- Net income: roughly $42.1 billion
- iPhone revenue: $85.27 billion (about a 23% jump)
- Services: roughly $30.0 billion (up ~14%)
- China (including Hong Kong and Taiwan): $25.53 billion, up ~38%
- Gross margin: 48.2%
Apple’s CFO Kevan Parekh highlighted near‑record margins and strong operating cash flow — nearly $54 billion — which funded almost $32 billion returned to shareholders via buybacks and dividends. The board declared a $0.26 per share cash dividend payable in February.
(Those figures come from Apple’s January 29, 2026, results and the company’s investor remarks.)
Where growth came from — and where it didn’t
The iPhone 17 cycle appears to be the engine: Apple said demand exceeded expectations across regions, with particularly dramatic strength in China and a quarterly record in India. If you want a breakdown of what’s new and convincing users to upgrade, see our guide to the iPhone 17 and 17 Pro.
Services — Apple’s recurring‑revenue business that includes iCloud, Apple TV+, App Store cut, ads and AppleCare — also posted an all‑time revenue record, growing about 14% year over year. That expansion helps smooth out device‑driven seasonality and makes the installed base milestone more valuable.
Not everything climbed: Mac revenue disappointed and fell year over year after Apple shipped an updated MacBook Pro with its M4 chip; Mac revenue landed below consensus. Wearables, Home and Accessories — the bucket that includes the Apple Watch and AirPods — slipped modestly. If you’re shopping Apple laptops this year, the new M4 machines and earlier MacBook models often show up in deals; the MacBook Air and Pro lineup is still a good place to start.
Supply, memory costs and AI — the crosscurrents
Cook said Apple is in “supply chase mode”: demand outstripped the company’s ability to ship enough devices during the quarter. That constraint will likely persist into the March quarter, the company warned, and Apple signaled the current quarter could be tighter on iPhone supply.
A separate but related worry is memory. The global data‑center AI buildout has strained memory markets, lifting component prices. Apple said memory had a minimal impact in the December quarter, but expects a bigger effect in the coming quarter — which could press margins unless pricing stabilizes or Apple absorbs higher costs.
Apple is also leaning into AI differently than some peers. Rather than building massive public AI clouds, the company announced it will use a custom Google Gemini model for its on‑device Apple Intelligence features and Siri updates. That partnership is central to Apple’s AI plans and could reshape how device and cloud AI integrate; more on that development is in our piece about Apple’s Gemini collaboration for Siri.
The near term: guidance and what to watch
For the March quarter Apple forecast revenue growth between 13% and 16% (about $107.8 billion to $110.66 billion), signaling management expects momentum to carry forward despite supply and component‑cost headwinds. Services are expected to grow at a pace similar to the December quarter (roughly mid‑teens).
Apple’s R&D spend rose sharply — reflecting investments in chip design and AI capabilities — while capital expenditures were modest relative to cash flow. That combination suggests Apple is investing in future feature sets (and chips) while continuing to return capital to shareholders.
Why this matters beyond the numbers
A single quarter doesn’t rewrite the long game, but hitting record iPhone revenue and a record services quarter at the same time is rare and meaningful. It confirms Apple’s ability to convert product upgrades and regional rebounds into durable revenue streams. The China rebound — nearly 38% growth — is particularly notable after a period of softness there.
Still, the margin story will be worth following. Memory price inflation, chip manufacturing constraints and supply mismatches create real operational risks. Investors will parse whether Apple’s mix (more Pro models, services, and regional rebounds) can offset cost pressures.
Apple’s official results and commentary are available from the company’s newsroom: Apple reports first quarter results.
If you’re tracking the device side while shopping, accessories and wearables are moving in and out of promotions — the Apple Watch selection is easy to browse online if you’re weighing an upgrade.
Numbers will keep shifting, but for now Apple has shown — at least for the holiday quarter — that its flagship product cycle, paired with a growing services base and an aggressive approach to AI partnerships, remains a formidable combination.