Apple reported better-than-expected fiscal fourth-quarter results on Monday, with revenue hitting $114.48 billion. Strong demand for the iPhone 18 Pro and higher prices helped the company beat Wall Street estimates despite rising chip costs. CEO John Ternus said, "Apple could not yet predict when supply and demand would be balanced."
Apple reported better-than-expected fiscal fourth-quarter results on Monday, driven by strong early demand for its iPhone 18 Pro lineup and higher product prices that helped offset rising memory-chip costs, according to Reuters.
The company posted revenue of $114.48 billion for the fourth quarter, exceeding Wall Street estimates of $113.39 billion, according to LSEG data. Earnings stood at $2.10 per share, beating analysts' expectations of $1.99 per share, even after excluding a 5-cent-per-share benefit from tariff refunds.
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The results come as Apple undergoes a strategic shift under new CEO John Ternus, who took over in September. According to Reuters, the company is changing its traditional iPhone launch schedule after nearly two decades of introducing most new models during the autumn. This year, Apple launched its iPhone Pro and Duo models, while other variants are expected to arrive next year.
Apple has also expanded its product launches ahead of the holiday shopping season, introducing several new devices, including its first touchscreen laptops and a smart-home hub. The broader release strategy is aimed at smoothing the company's revenue cycle, which has historically been heavily dependent on iPhone sales during the holiday quarter before slowing towards the end of the fiscal year.
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iPhone Duo supply constraints persist
Apple's latest results come amid strong demand for its first foldable smartphone, the iPhone Duo, which sold out within hours of becoming available online and attracted queues at Apple stores last month, Reuters reported.
However, the device has also faced customer complaints about cracked displays. In an interview with Reuters, Ternus said only a very small percentage of iPhone Duo units had been returned because of display issues, adding that Apple was replacing the affected devices.
He also acknowledged that supply remains constrained as the company struggles to keep pace with demand. Ternus told Reuters that Apple could not yet predict when supply and demand would be balanced.
Fourth-quarter iPhone revenue, which included sales of the iPhone 18 Pro lineup but excluded iPhone Duo sales, came in at $57.58 billion, surpassing analyst estimates of $56.54 billion, according to LSEG data.
Apple raises prices to counter rising memory costs
Apple is also facing pressure from surging memory-chip prices, driven by growing demand from the artificial intelligence industry. The increase in component costs could weigh on the company's margins, particularly as consumers opt for higher-storage versions of its devices.
To mitigate the impact, Apple raised prices for its iPhone 17 models by $100 and increased prices on some MacBook models alongside the launch of its latest iPhone 18 Pro lineup.
Ternus told Reuters that higher memory costs compared with the June quarter were partly offset by inventory benefits and lower costs for certain non-memory components. He added that the price increases also helped cushion the impact.
Apple reported a gross margin of 47.9% for the quarter, ahead of analysts' expectations of 47.5%, according to LSEG data.
Mac sales beat estimates, services revenue remains steady
Beyond iPhones, Apple's Mac business delivered a strong performance, with revenue reaching $10.79 billion, significantly above analysts' estimates of $9.61 billion. Mac computers have gained traction among technology enthusiasts as a platform for running AI agents, Reuters reported.
Services revenue stood at $31.57 billion, broadly in line with the $31.58 billion expected by analysts.
However, other product categories missed market expectations. iPad revenue came in at $6.23 billion, below estimates of $6.70 billion, while wearables, home and accessories generated $8.30 billion against expectations of $9.06 billion.
Another area investors are watching is the cost of Apple's artificial intelligence initiatives, particularly its revamped Siri assistant. Ternus told Reuters that the upgraded assistant is now handling 2.5 billion requests daily.
Apple's ability to sustain strong iPhone demand, manage rising component costs and expand its AI-powered services will remain central to its financial performance in the coming quarters.
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