Latest quarter

Apple reported Q3 FY2026 revenue of $109.4 billion, up 16.4% from $94.0 billion a year earlier. Revenue exceeded the consensus of $108.7 billion, while adjusted EPS of $1.91, as the consensus counts it, exceeded the $1.88 consensus. Apple reported diluted EPS of $2.02, compared with $1.57 in Q3 FY2025.

The filing attributed higher iPhone sales primarily to Pro models, higher Mac sales to laptops, and higher Services sales to advertising and cloud services. The filing said iPad sales declined because of lower iPad mini and iPad Air sales, while Wearables, Home and Accessories sales increased on Accessories and Wearables. Apple reported gross margin of 50.1%, compared with 46.5% a year earlier; the filing cited product mix and tariff refunds, partly offset by higher costs including memory. Operating margin was 32.6%, compared with 30.0%, and free cash flow was $31.9 billion, compared with $24.4 billion. Apple’s 16.4% revenue growth was within its 14.0% to 17.0% outlook, while its 50.1% gross margin was above its 47.5% to 48.5% outlook.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

Tim Cook said June-quarter supply constraints fell primarily on Mac and, to a lesser extent, iPhone and iPad, reflecting high demand and limited supply-chain flexibility. He said availability of the advanced semiconductor nodes used for Apple’s SoCs was the primary constraint. In response to analyst questions about the source of the shortfall, Cook said iPhone and Mac demand had exceeded Apple’s expectations and said the constraints were not a supplier or partner issue.

Cook said Apple had raised prices because memory pricing had increased, while describing the decision as a business judgment based on units, revenue and margin over the long term. He said carry-in inventory would provide a decreasing benefit over time and that market memory prices could continue to rise beyond the September quarter. The filing said product gross margin increased on product mix and tariff refunds, partly offset by higher costs including memory.

Kevin, Apple’s CFO, said Services set a June-quarter revenue record in advertising, the App Store, AppleCare, music and video, and said cloud services and payment services set all-time records. In response to questions on Services growth, he said foreign exchange was expected to remain a headwind and cited mobile-gaming headwinds in the App Store and changes to the App Store business model in certain countries. He said Apple continued to operate under a U.S. court ruling affecting App Store link-out transactions and that the Supreme Court would hear Apple’s appeal.

Cook said Apple had been increasing operating expenses and AI spending, while the filing attributed higher research and development expense partly to infrastructure costs, including AI investment. Cook said some Siri AI requests could run on device and described that capability as strategic. Kevin said Apple would not provide color or guidance beyond the September quarter.

Guidance

Kevin said Apple expects total company revenue to grow 9.00% to 11.0% year over year in Q4 FY2026. He said foreign exchange is expected to be a sequential headwind of around two and a half percentage points to the year-over-year total-company growth rate, and Apple expects supply constraints to increase significantly and affect iPhone, Mac and iPad. Kevin said Apple was not providing color or guidance beyond Q4 FY2026.

How analysts reacted

Analysts’ price targets: $245.00 to $405.00, $349.00 on average (as of 18 October 2026).

Rating and price-target actions since the results on 30 July 2026: