[AAPL] Apple: Q4 FY2026 earnings preview, chip supply and memory costs

Apple designs and sells the iPhone, Mac, iPad and wearables, and runs a services business built on the App Store, advertising and cloud services across an installed base of more than 2.5 billion active devices[1]. Apple's September-quarter earnings are scheduled for 2026-10-29 and will cover the fourth quarter of fiscal 2026, the September quarter ending September 26, 2026[2]; it will be the first report from the new leadership team after Tim Cook's final call as CEO[3]. In the latest disclosed June quarter, net sales were $109.42 billion, up 16% year over year, with iPhone revenue of $54.25 billion, up 22%, and Services revenue of $30.74 billion, up 12%[4]; company gross margin was 50.1%, including roughly 2 percentage points from tariff refunds, and diluted EPS was $2.02[5]. For the September quarter, Apple guided to 9% to 11% revenue growth, a 47% to 48% gross margin including about 1 point of tariff refunds, operating expenses of $19.1 billion to $19.4 billion and a tax rate of about 16.5%[6]. The analyst consensus compiled by Drillr stands at $113.21 billion of revenue from 16 analysts and EPS of $1.98 from 17 analysts[7], while the earnings calendar records $113.40 billion of revenue and EPS of $1.995[2].

Three things matter most in the coming report. The first is where revenue growth lands within the 9% to 11% range: management attributed the slowdown to a roughly 2.5-point currency drag and sharply worse advanced-node chip supply[8], while iPhone and Mac still grew 22% and 29% in the June quarter[4], so the growth rate will show whether the supply-constraint explanation still holds. The second is gross margin after tariff refunds: product gross margin was 40.1% in the June quarter[9], but the 10-Q already cites rising costs including memory[10], and management said memory prices will keep rising after September[11], which will decide whether recent high margins are structural or propped up by mix and refunds. The third is whether Services can hold double-digit growth: Services growth slowed from 16% in the March quarter to 12% in the June quarter[4], management flagged a roughly 5-point currency headwind to Services growth in the September quarter[11], and separating currency from App Store regulation matters for a profit pool with a gross margin near 75%[9].

Company Background and Business Structure

Apple is a consumer electronics company built around its own chips and operating systems, which monetizes services on top of its installed hardware base. Founded in 1976 and headquartered in Cupertino, California, Apple ends its fiscal year on the last Saturday of September; it serves consumers, small and mid-sized businesses and education, enterprise and government customers through its own retail and online stores, a direct sales force, and carriers, wholesalers, retailers and resellers. The June-quarter call on July 30, 2026 was Tim Cook's last earnings call as CEO, and the company said the leadership transition was proceeding smoothly[3].

Apple's revenue is heavily concentrated in the iPhone, with Services as the second-largest source. Of fiscal 2025 net sales of $416.16 billion, iPhone contributed $209.59 billion, or about 50.4%; Mac $33.71 billion; iPad $28.02 billion; Wearables, Home and Accessories $35.69 billion; and Services $109.16 billion, or about 26.2%[12]. The 10-K attributed that year's iPhone growth to Pro models and Services growth to advertising, the App Store and cloud services[13].

Apple manages its operating segments by geography, and recent growth has come mostly from outside the Americas. In the June quarter, Americas net sales were $45.78 billion, up 11%; Europe $29.40 billion, up 22%; Greater China $18.82 billion, up 22%; Japan $6.55 billion, up 13%; and Rest of Asia Pacific $8.87 billion, up 16%. Greater China grew 30% over the first nine months, mainly on iPhone, with a favorable effect from a stronger renminbi[14]. Management also said the new MacBook Neo is driving large-scale adoption in US education, and that more than half of iPad and Apple Watch buyers were first-time purchasers[3].

Apple designs its own chips and products and has Asian partners assemble the hardware, while Services revenue is recognized over time or per transaction. The 10-K says a significant majority of manufacturing is performed by outsourcing partners located primarily in China mainland, India, Japan, South Korea, Taiwan and Vietnam[15]; as of June 27, 2026, manufacturing purchase obligations were $57.0 billion, with $56.2 billion payable within 12 months[16]. Hardware revenue is recognized on delivery, while Services revenue comes from App Store commissions, advertising, cloud services such as iCloud, AppleCare, payments, subscription content and licensing, and the value of services bundled with hardware is deferred and recognized as Services revenue[12]. The two businesses have very different profitability: in fiscal 2025, product gross margin was 36.8% and Services gross margin was 75.4%[17].

Financial History and Current Position

Apple's revenue has risen steadily over the past three fiscal years, and its gross margin has kept expanding. Net sales were $383.29 billion, $391.04 billion and $416.16 billion in fiscal 2023 through 2025, with 6% growth in fiscal 2025[12]; company gross margin rose from 44.1% in fiscal 2023 to 46.2% in fiscal 2024 and 46.9% in fiscal 2025[17]. Fiscal 2025 operating income was $133.05 billion, net income was $112.01 billion, and diluted EPS was $7.46, compared with $6.08 a year earlier[18].

Apple's annual operating cash flow far exceeds its capital spending, and most of it goes to buybacks and dividends. In fiscal 2025, operating cash flow was $111.48 billion and capital expenditure was $12.72 billion, while the cash flow statement shows $90.71 billion of repurchase payments, $15.42 billion of dividend payments and $10.93 billion of term-debt repayments[19]. The 10-K also disclosed that Apple announced a new repurchase program of up to $100 billion in May 2025, repurchased $89.3 billion of stock during the year and raised its quarterly dividend to $0.26[20].

In the first three quarters of fiscal 2026, Apple's revenue grew clearly faster than in the prior year, and gross margin rose quarter by quarter. December-quarter net sales were $143.76 billion, up 16%, including iPhone revenue of $85.27 billion, up 23%, with company gross margin of 48.2%, product gross margin of 40.7% and Services gross margin of 76.5%[21]; March-quarter net sales were $111.18 billion and June-quarter net sales were $109.42 billion, bringing nine-month sales to $364.36 billion, up 16%[4]. March-quarter gross margin was about 49.3%[22]; June-quarter gross margin was 50.1%, including about 2 points from tariff refunds[5], operating income was $35.70 billion, up 27%, R&D expense was $11.73 billion, up 32%, net income was $29.79 billion, and diluted EPS was $2.02 versus $1.57 a year earlier[22], of which about $0.11 came from tariff refunds[5].

Apple's cash generation strengthened further in the first nine months of fiscal 2026, while the company locked in inventory ahead of tight supply. Nine-month operating cash flow was $117.00 billion, versus $81.75 billion a year earlier; over the same period, Apple paid $62.09 billion for buybacks, $11.78 billion in dividends and $6.80 billion in capital expenditure, while inventories rose by $5.46 billion and other current and non-current assets rose by $16.27 billion[23]. Apple paid off the remaining $8.8 billion of deemed repatriation tax during the nine months, and in the June quarter it repurchased $25.8 billion of stock and paid $4.0 billion in dividends[16]; at the end of June it held $147 billion in cash and marketable securities against $84 billion of total debt[3]. On April 30 the board authorized an additional repurchase program of up to $100 billion and raised the quarterly dividend from $0.26 to $0.27[24].

Operating Model

Apple's revenue equals hardware revenue plus Services revenue, and hardware revenue depends on both deliverable units and average selling prices. Hardware revenue can be read as the sum of deliverable units times average selling price across categories, where units are capped by the smaller of upgrade demand and advanced-node system-on-chip supply, a constraint management described as having limited near-term flexibility[11]; average selling prices depend on the Pro mix, price increases and currency, and the 10-Q attributed June-quarter iPhone growth to Pro models and Mac growth to laptops[25]. When supply falls short, unmet demand can either slip into the next quarter or be lost outright, which is where revenue growth is most sensitive to supply; management already cited iPhone and Mac supply constraints in the March quarter[26]. Services revenue is roughly active devices times paid penetration times spending per user, plus licensing, and June-quarter growth came mainly from advertising and cloud services[25], with currency and App Store regulation as the main external influences[11].

Apple's operating income equals product gross profit plus Services gross profit, minus R&D and SG&A, and product gross margin is the most volatile link. Product gross margin is set by model mix, component costs, especially memory, tariffs and currency: the March-quarter 10-Q attributed the increase in product gross margin to mix and stronger foreign currencies[27], while the June-quarter 10-Q credited mix and tariff refunds and named higher costs including memory as an offset[10]; memory contract-price increases typically reach cost of sales with a lag of one to two quarters. Services gross margin holds near 75%, and June-quarter Services gross profit of $23.25 billion accounted for more than 40% of company gross profit of $54.77 billion[9]. Operating expenses are growing faster than revenue: June-quarter operating expenses were $19.08 billion, up about 23% year over year, with R&D up 32% against 16% revenue growth[22].

Apple's operating cash flow roughly equals net income plus depreciation, amortization and stock compensation, adjusted for working capital, and with light capital spending most of the cash returns to shareholders. In fiscal 2025, depreciation and amortization was $11.70 billion, share-based compensation was $12.86 billion and capital expenditure was $12.72 billion, while buybacks and dividends together totaled about $106.1 billion[19]. Working capital follows the seasonality of payables to manufacturing partners and component suppliers, with September-quarter launch builds absorbing cash that the December quarter releases; the new element in fiscal 2026 is that Apple has been locking in purchases early under tight supply, lifting manufacturing purchase obligations from $44.6 billion at the end of March to $57.0 billion at the end of June[24][16].

Industry and Competitive Position

Apple is the world's largest smartphone maker by revenue, leads the premium phone market, and competes with Windows PCs and Chromebooks in personal computers and tablets. On its June-quarter call, the company cited industry surveys showing the iPhone as the best-selling model in the US, urban China, the UK, France, Australia and Japan; in computers, management said the MacBook Neo is driving US schools to replace competing devices with Macs[3].

Apple's differentiation comes from its own silicon, the iOS and macOS ecosystem and a very large installed base, on which the Services business is built. By the December quarter, active devices had surpassed 2.5 billion[1]; in the June quarter, the installed base reached new all-time highs across all major product categories and geographic segments[5]. A larger installed base widens the room to monetize advertising, cloud, payments and subscriptions, which is one reason Services gross margin can stay near 75%.

Apple's current constraints come from three directions: supply chain, trade policy and regulation. Advanced-node capacity and memory chips are being absorbed by AI data-center demand, the DRAM market has only three suppliers, and Apple said it is evaluating all additional sourcing options[8]; manufacturing is concentrated in Asia, so tariffs and export controls directly affect cost and availability[15]; and the App Store commission model faces a US ruling that currently bars fees on link-out transactions, which Apple has appealed to the Supreme Court[11], as well as constraints under the EU Digital Markets Act[28]. The available comparison also has clear limits: Apple does not disclose unit volumes, average selling prices, channel inventory or Services sub-business revenue, and the record contains no comparable peer financials, so shifts in market share cannot be measured quantitatively.

Core Debates

With advanced-node chip supply limiting iPhone and Mac shipments, can Apple still deliver the 9% to 11% revenue growth it guided for the September quarter?

This debate decides whether Apple's revenue slowdown is a one-off or a lasting shift, because the iPhone, Mac and iPad generated about 63% of revenue in the year-ago quarter. Derived as fiscal 2025 minus the first nine months, the year-ago September quarter had net sales of about $102.47 billion, including roughly $49.03 billion from iPhone, $8.73 billion from Mac and $6.95 billion from iPad[12][4]. Revenue grew about 16% in each of the first three quarters of fiscal 2026[21][4], but September-quarter guidance dropped to 9% to 11%[6], and management attributed the slowdown to currency and supply rather than demand[8]. If the supply constraint merely delays deliveries, the gap should be recovered in the December quarter; if it holds back the iPhone 18 Pro launch and back-to-school Mac sales, the slowdown will persist.

More evidence supports the "strong demand, constrained supply" reading, but several points cut the other way. On the supporting side, June-quarter iPhone revenue was $54.25 billion, up 22%, and Mac revenue was $10.35 billion, up 29%[4]; the company's 16% revenue growth landed inside the 14% to 17% range guided in April, and management has said since the March quarter that demand exceeded its forecasts[26]; manufacturing purchase obligations also rose from $44.6 billion at the end of March to $57.0 billion at the end of June[24][16]. On the other side, iPad already fell 6% in the June quarter[4], and management acknowledged it lacks enough data on demand elasticity after recent Mac and iPad price increases[11]; based on media reports of the launch schedule, the September quarter includes only about one week of iPhone 18 Pro sales, with the standard model pushed to next spring. An alternative explanation is that part of the slowdown comes from cooling demand after price increases and a shifting new-model mix, not supply alone. Meanwhile, the $113.21 billion revenue consensus sits about 10.5% above the derived year-ago figure, close to the top of guidance[7].

Supply limits pass straight into revenue through units, but in reported results they are hard to separate from a demand slowdown. The chain runs from advanced-node chip availability to deliverable iPhone, Mac and iPad units, which combine with Pro mix and price increases to form hardware revenue and ultimately company net sales; unmet demand either slips into the December quarter or is lost. The baselines are 16% company revenue growth, $54.25 billion of iPhone revenue and $10.35 billion of Mac revenue in the June quarter, and $57.0 billion of manufacturing purchase obligations[4][16]. What remains unresolved is that Apple does not disclose units, average selling prices or channel inventory, so outsiders can only infer indirectly, from growth rates, management commentary and purchase obligations, whether the gap will be recovered.

The next checkpoints are where revenue growth lands in the range and how management describes December-quarter supply. Specifically: whether company revenue growth sits nearer 9% or 11%; whether iPhone growth stays in double digits; whether Mac holds the year-ago level of about $8.73 billion; what management says about December-quarter supply constraints and inventory for the iPhone 18 Pro and the foldable iPhone Duo; and whether manufacturing purchase obligations keep rising or fall back. If revenue growth comes in below 9% with iPhone growth in single digits, or management says supply limits will extend into the December quarter and affect new-model launches, the "purely short-term supply problem" reading weakens.

With memory prices still rising and tariff refunds fading, can Apple hold its product gross margin?

This debate decides whether Apple's recent high margins can last, because products generated about 72% of revenue in the year-ago quarter. Derived as the full year minus nine months, year-ago September-quarter product revenue was about $73.72 billion, with a product gross margin of about 36.2%[18][22]. The 50.1% company gross margin in the June 2026 quarter looks like a record, but about 2 points of it came from tariff refunds[5]; September-quarter guidance of 47% to 48% includes about 1 point of refunds, leaving only 46% to 47% without them[6], below the roughly 47.2% derived for the year-ago quarter. Each round of memory cost increases has to be absorbed through pricing or model mix or it falls straight to profit, while R&D expense is growing at more than 30%[22].

The case for holding margin rests on mix and pricing, while the case against centers on memory costs. On the supporting side, product gross margin in the first three quarters of fiscal 2026 was 40.7%, about 40.3% and 40.1%, all above the prior-year levels[21][9], and the 10-Q attributed the improvement to model mix, meaning a higher share of Pro models[27]; Apple has also recently raised prices on Mac and iPad[11]. On the other side, the June-quarter 10-Q explicitly cites "higher costs, including memory"[10], and management said memory prices have risen sequentially for several quarters and will keep rising after September[8]; the 47.5% midpoint of September-quarter margin guidance is 2.6 points below the June-quarter actual, with about 1 point from smaller refunds and the rest from cost and mix[6]. Industry research firm TrendForce estimates the bill of materials for the 256GB iPhone 18 Pro is about 38% higher than its predecessor's and believes Apple will give up part of its margin to soften price increases[29]. An alternative explanation is that recent high product margins came mainly from Pro mix and refunds, temporarily masking underlying cost pressure.

Memory price increases reach costs with a lag, so their full effect on margin may only show up over the next few quarters. The chain runs from memory contract prices, which enter product cost of sales after one to two quarters, plus shrinking tariff refunds, minus the offset from Pro mix and pricing, to product gross margin and then company gross margin; R&D growth of 32% within operating expenses further squeezes operating margin. The baselines are a 50.1% June-quarter company gross margin including about 2 points of refunds[5], a 40.1% product gross margin[9] and $19.08 billion of operating expenses[22]. What remains unresolved is that Apple does not disclose memory costs separately and gives only approximate refund figures, so outsiders cannot precisely split the contributions of cost, mix and refunds.

The next checkpoints are where gross margin lands within guidance and how Apple explains the change in product margin. Specifically: where company gross margin falls in the 47% to 48% range and how much refunds contribute; whether product gross margin stays above the year-ago level of about 36.2%; whether the 10-Q names memory as a main driver of the product-margin change; what management says about December-quarter gross margin and memory costs; and whether operating expenses exceed the $19.4 billion ceiling. If gross margin falls below 47% and Apple blames memory costs, or management lowers its December-quarter margin outlook, the view that mix and pricing can absorb costs weakens.

Services growth has slowed from 16% to 12%: is it currency, or are App Store rules starting to bite?

This debate decides whether Apple's profit stabilizer is loosening, because Services makes up about 28% of revenue at a gross margin near 75%. Year-ago September-quarter Services revenue was about $28.75 billion[12][4], and Services contributed more than 40% of company gross profit in the June quarter[9]. When hardware is held back by supply and memory costs, Services cushions profit; if the Services slowdown is not just currency, regulatory pressure on the App Store commission model will show up directly in profit.

Management attributed the slowdown mainly to currency, but the same call also listed factors unrelated to it. On the currency side, the App Store still set a June-quarter revenue record, cloud, payments, advertising and video kept growing at double digits, and management said currency was the main driver of the sequential slowdown[8], while the 10-Q attributed Services growth to advertising and cloud services[25]. On the other side, management also cited the lack of a major theatrical release, softness in mobile gaming and App Store rule changes in some regions[8]; in the US, link-out transactions currently cannot carry a commission, and Apple has appealed to the Supreme Court[11]; in the EU, the European Commission fined Apple €500 million on April 23, 2025 under the Digital Markets Act and ordered it to remove steering restrictions, and a separate investigation could bring fines of up to 10% of worldwide annual net sales if a violation is found[28]. In addition, June-quarter Services gross margin was flat year over year[10], whereas December-quarter Services gross margin had risen from 75.0% to 76.5%[21] and the March quarter was still rising[27]. An alternative explanation is that rule changes are gradually eroding high-margin commission revenue, masked for now by growth in advertising and cloud.

Changes in Services revenue pass almost directly to profit at a roughly 75% gross margin, but management's two framings of the currency effect make the split harder. The chain runs from the installed base times paid penetration and spending per user, meaning growth in advertising, cloud and payments minus App Store commissions constrained by regulation, adjusted for currency translation, to Services net sales, which convert to Services gross profit at about 75%. The baselines are $30.74 billion of June-quarter Services revenue[4], a 75.6% Services gross margin[9], and the roughly 5-point year-over-year currency headwind to Services growth that management flagged for the September quarter[11]. What remains unresolved is that management has described the currency effect both as about 5 points year over year and as about 2.5 points sequentially[8], and Apple does not disclose Services sub-business revenue, so the regulatory effect is hard to quantify on its own.

The next checkpoints are whether Services growth and Services margin both hold, and whether management breaks out the individual factors. Specifically: whether Services growth is at least 10%; whether Services gross margin holds around 75%; how management splits App Store, advertising and currency effects; and how the US Supreme Court link-out commission case and the EU Digital Markets Act proceedings develop. If Services growth falls below 8% and Apple attributes it to App Store rules, or Services gross margin drops by more than 1 point year over year, the "mainly currency" reading weakens.

Risks and Falsifiers

Tariffs and trade restrictions are the first external risk to Apple's product gross margin. A significant majority of manufacturing is performed by partners in China mainland, India, Japan, South Korea, Taiwan and Vietnam[15], US tariff policy is still shifting, and the Commerce Department's Section 232 investigation covers semiconductors and downstream products that contain them[30]. In fiscal 2025, tariff costs already pushed product gross margin down from 37.2% to 36.8%[17][31]; if the Section 232 investigation leads to tariffs on finished devices containing chips, the cost would flow straight into product cost of sales, while this year's tariff refunds are one-off. If Apple flags no new tariff costs and its December-quarter margin guidance includes no added tariff drag, this risk has not materialized for now.

The leadership transition will not directly change September-quarter numbers, but it will shape capital returns, the pace of R&D and the rollout of AI features. July 30 was Tim Cook's last earnings call as CEO, and October 29 will be the new leadership team's first report[3]; Apple's AI features depend on its collaboration with Google[1], and Apple Intelligence has been delayed in the EU by regulation[11]. In the first nine months of fiscal 2026 Apple paid $62.09 billion for buybacks[23] and spent $34.04 billion on R&D, up about 33%[22]; the pace of that spending, and whether AI features can support upgrade demand, may shift with the new team's priorities. If the new team keeps the current capital-return and guidance framework in the October report and flags no further AI delays, this risk recedes.

The risk from prolonged supply limits is that deferred demand turns into lost demand. Advanced-node capacity is being absorbed by AI chip demand, and inventory for the iPhone 18 Pro and the foldable iPhone Duo launching in October may fall short[11][8]. Year-ago September-quarter iPhone revenue was about $49 billion[12], so every 5 points of lost iPhone growth removes about $2.45 billion of quarterly revenue and, at the 47% to 48% guided gross margin[6], about $1.15 billion to $1.18 billion of gross profit. If September-quarter iPhone revenue grows at least 15% year over year and Apple says December-quarter supply is improving, this risk is falsified.

The risk that memory costs rise faster than prices would push product gross margin down directly. The DRAM market has only three suppliers, AI server demand is absorbing capacity, and Apple said prices will keep rising beyond the September quarter[8][11]; the June-quarter 10-Q already names memory among the sources of higher costs[10]. On year-ago product revenue of about $73.7 billion[18], each 1-point decline in product gross margin removes about $0.74 billion of quarterly gross profit. If September-quarter product gross margin is at least 38% and management guides December-quarter gross margin no lower than the September quarter, this risk is falsified.

The risk that regulation compresses App Store commissions would hit profit at close to the Services gross margin. US link-out transactions currently cannot carry a fee[11], and the EU Digital Markets Act requires Apple to allow steering and allows fines of up to 10% of worldwide annual net sales[28]. Year-ago September-quarter Services revenue was about $28.75 billion at a gross margin near 75%[12][18], so each point of lost Services growth removes about $0.29 billion of quarterly revenue and about $0.22 billion of gross profit. If Services growth is at least 10%, Services gross margin is at least 75.3% and Apple quantifies no new regulatory impact, this risk is falsified.

What to Watch Next

• Chip supply and revenue growth: company revenue grew 16% in the June quarter against September-quarter guidance of 9% to 11%[6]. Growth below 9% with iPhone in single digits would weaken the "just a supply problem" reading.
• iPhone and Mac revenue: iPhone was $54.25 billion (+22%) and Mac $10.35 billion (+29%) in the June quarter[4]. Watch whether iPhone grows at double digits and Mac holds about $8.73 billion; a statement that supply limits extend into the December quarter and affect launches would weaken the current view.
• Manufacturing purchase obligations: $57.0 billion at the end of June[16]. A decline alongside slower revenue would strengthen the cooling-demand explanation.
• Company and product gross margin: 50.1% company gross margin including about 2 points of refunds and a 40.1% product gross margin[9]. Watch the position within 47% to 48% and whether product margin stays above about 36.2%; a margin below 47% blamed on memory, or a lower December-quarter outlook, would weaken the view.
• Operating expenses: $19.08 billion in the June quarter[22]. Spending above the $19.4 billion ceiling with continued fast R&D growth would pressure operating margin.
• Services revenue and margin: $30.74 billion (+12%) at a 75.6% gross margin. Growth below 8% blamed on App Store rules, or a margin decline of more than 1 point, would weaken the "mainly currency" reading.
• Regulatory developments: the US link-out commission case is on appeal and EU Digital Markets Act proceedings continue[28]. If Apple quantifies a new regulatory impact, the "mainly currency" reading weakens.

Conclusion

Apple's business is driven by iPhone upgrades, deliverable Mac and iPad units, and Services monetization across more than 2.5 billion devices, and its current financial position combines fast growth and high profitability with several supports shifting at once. Nine-month fiscal 2026 revenue was $364.36 billion, up 16%, June-quarter gross margin was 50.1%, operating cash flow far exceeds capital spending, and the company holds $147 billion in cash and marketable securities[3]; yet September-quarter guidance cuts revenue growth to 9% to 11% and gross margin to 47% to 48%. The central unresolved relationships are whether the revenue slowdown reflects supply delaying demand or price increases and mix changes cooling demand itself; whether product gross margin can hold through Pro mix and pricing once memory costs rise and tariff refunds fade; and how much of the Services slowdown comes from currency versus App Store regulation.

Since the July 30 results, only one qualifying independent outside assessment has appeared: TrendForce's cost estimate published on August 10[29]. TrendForce estimates the bill of materials for the 256GB iPhone 18 Pro is about 38% higher than its predecessor's and that memory's share of the bill of materials rose from about 10% a year earlier to about 34% in the third quarter of 2026; it believes Apple will follow the approach of its recent MacBook launches by giving up part of its gross margin to soften price increases, and it sees global smartphone production under pressure from the second half of 2026 through 2027[29]. That view lines up with the bearish evidence in the memory-cost debate, implying pressure on product gross margin in the December quarter and beyond, but because the September quarter includes only about one week of iPhone 18 Pro sales, its effect on this report is limited; it also touches the supply debate, since weaker industry output may reflect high prices suppressing demand rather than chip supply alone. This is an industry research estimate, not a figure Apple disclosed; other coverage in the period was mostly launch, pricing and litigation news, so only this one assessment is available and it does not amount to an outside consensus.

Taken together, the combination that would materially strengthen the current understanding is revenue growth near the top of guidance with double-digit iPhone growth, gross margin excluding refunds at or above 46% to 47% with product margin still above the prior-year level, Services growth of at least 10% with Services margin holding around 75%, and the new leadership saying December-quarter supply is improving. Conversely, if revenue growth falls below 9%, gross margin drops below 47% on memory costs, Services growth falls below 8% on App Store rules, or management says supply limits will extend into the December quarter, the "strong demand, absorbable costs, currency-only Services slowdown" reading would be materially weakened.

Sources

[1] AAPL Q1 FY2026 earnings call 2026-01-29 · installed base, supply and memory · 2026-01-29 · earnings-call · https://gateway.drillr.ai/mcp/private

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[6] AAPL Q3 FY2026 earnings call 2026-07-30 · September-quarter guidance · 2026-07-30 · earnings-call · https://gateway.drillr.ai/mcp/private

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[12] AAPL 10-K filed 2025-10-31 · net sales by category FY2025 · 2025-10-31 · 10-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-K&dateb=&owner=include&count=40

[13] AAPL 10-K filed 2025-10-31 · category drivers FY2025 · 2025-10-31 · 10-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-K&dateb=&owner=include&count=40

[14] AAPL 10-Q filed 2026-07-31 · Q3 FY2026 net sales by reportable segment · 2026-07-31 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-Q&dateb=&owner=include&count=40

[15] AAPL 10-K filed 2025-10-31 · manufacturing concentration and trade risk · 2025-10-31 · 10-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-K&dateb=&owner=include&count=40

[16] AAPL 10-Q filed 2026-07-31 · Q3 FY2026 liquidity, purchase obligations and capital return · 2026-07-31 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-Q&dateb=&owner=include&count=40

[17] AAPL 10-K filed 2025-10-31 · gross margin percentage FY2025 · 2025-10-31 · 10-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-K&dateb=&owner=include&count=40

[18] AAPL 10-K filed 2025-10-31 · statement of operations FY2025 · 2025-10-31 · 10-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-K&dateb=&owner=include&count=40

[19] AAPL 10-K filed 2025-10-31 · cash flow statement FY2025 · 2025-10-31 · 10-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-K&dateb=&owner=include&count=40

[20] AAPL 10-K filed 2025-10-31 · capital return program FY2025 · 2025-10-31 · 10-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-K&dateb=&owner=include&count=40

[21] AAPL 10-Q filed 2026-01-30 · Q1 FY2026 net sales by category and gross margin · 2026-01-30 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-Q&dateb=&owner=include&count=40

[22] AAPL 10-Q filed 2026-07-31 · Q3 FY2026 statement of operations · 2026-07-31 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-Q&dateb=&owner=include&count=40

[23] AAPL 8-K filed 2026-07-30 · nine-month cash flow statement · 2026-07-30 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=8-K&dateb=&owner=include&count=40

[24] AAPL 10-Q filed 2026-05-01 · Q2 FY2026 capital return and purchase obligations · 2026-05-01 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-Q&dateb=&owner=include&count=40

[25] AAPL 10-Q filed 2026-07-31 · Q3 FY2026 category drivers · 2026-07-31 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-Q&dateb=&owner=include&count=40

[26] AAPL Q2 FY2026 earnings call 2026-04-30 · June-quarter guidance and supply constraints · 2026-04-30 · earnings-call · https://gateway.drillr.ai/mcp/private

[27] AAPL 10-Q filed 2026-05-01 · Q2 FY2026 gross margin drivers · 2026-05-01 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-Q&dateb=&owner=include&count=40

[28] AAPL 10-Q filed 2026-05-01 · EU Digital Markets Act proceedings · 2026-05-01 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-Q&dateb=&owner=include&count=40

[29] TrendForce 2026-08-10 · iPhone 18 Pro BOM Cost Expected to Surge Nearly 40% · 2026-08-10 · TrendForce · https://www.trendforce.com/presscenter/news/20260810-13172.html

[30] AAPL 10-K filed 2025-10-31 · tariffs and Section 232 semiconductor investigation · 2025-10-31 · 10-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-K&dateb=&owner=include&count=40

[31] AAPL 10-K filed 2025-10-31 · gross margin drivers FY2025 · 2025-10-31 · 10-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000320193&type=10-K&dateb=&owner=include&count=40