Apple Smashes Sales Record on Strong iPhone, Services Sales

On Thursday, Apple reported its first-quarter earnings for fiscal year 2026, beating analyst expectations across the board. With revenue of $143.8 billion, Apple not only beat its previous record, it shattered it. Prior to last quarter, Apple’s best-ever quarter in terms of sales had been the 2024 holiday quarter, when revenue amounted to $124.3 billion, almost $20 billion short of the new record. Apple’s profit saw a similar increase, jumping from $36.3 billion in the year-ago period to an all-time high of $42.1 in the three months ended Dec. 27, 2025.

With total sales growing 16 percent year-over-year, it was Apple’s strongest quarter in terms of growth since the post-pandemic rebound of 2021, and the company has the iPhone and its ever-growing Services segment to thank for this. iPhone sales surged 23 percent to $85 billion last quarter, another record by far. Service revenue grew 14 percent to $30 billion, reaching that milestone just three years after hitting $20 billion for the first time. Apple’s remaining products were relatively flat with combined Mac, iPad, Home and Wearables sales declining 1 percent year-over-year to $28.5 billion.

Remarkably, Apple reported significant sales increases for each of its reporting regions including Greater China, which led with almost 38-percent growth. That marks a major turnaround for Apple in the important Chinese market, where sales had previously declined in 10 of the past 12 quarters. Looking ahead, Apple warned of supply constraints that could impact its margins going forward. As a result of the AI-fueled global data center boom, memory chips are expected to be in short supply for the foreseeable future, leading to higher prices and compressed margins for companies like Apple.

Trying to counter the widespread narrative that Apple is falling behind in the AI race, Tim Cook touted the widespread use of Apple Intelligence features, calling Apple devices “far and away the best platforms in the world for AI.”