Full Breakdown
Apple Posts Record Q3 Revenue but Shares Slip on Guidance and Memory-Chip Costs
8/1/2026, 5:07:22 AM
Record Revenue and Market Reaction
Apple announced that fiscal 2026’s third quarter, which ended June 27, generated $109.4 billion in revenue, a 16 percent year-over-year increase, and net income of $29.8 billion. Diluted earnings per share rose 29 percent to $2.02. Despite beating analysts’ expectations for both revenue and profit, after-hours trading saw the stock fall as much as eight percent, with a more than 6 percent decline reported by the Financial Times.
Product Performance and Pricing Adjustments
The iPhone segment drove the bulk of the growth, posting a 22 percent rise to $54.25 billion. Mac revenue jumped 29 percent to $10.35 billion, helped by the March launch of the entry-level MacBook Neo. Services revenue grew 12 percent to $30.74 billion but missed the $31.22 billion consensus, while iPad sales fell 6 percent to $6.19 billion. Apple raised prices on several models, including a $1 increase for Apple Music subscriptions and a $100 hike on select iPhone variants.
Guidance, Memory-Chip Constraints, and Dividend
For the current quarter, Apple projected revenue growth of 9-11 percent, below the roughly 12 percent analysts had anticipated. CEO Tim Cook attributed the tempered outlook to a supply constraint in the process used to produce Apple’s chips, a bottleneck intensified by the AI-driven surge in global memory-chip demand. CFO Kevan Parekh added that the supply chain now offers less flexibility than in prior years, forcing Apple to absorb higher memory costs. The board declared a dividend of $0.27 per share, payable on August 13 to shareholders of record as of August 10.
Leadership Transition and Strategic Outlook
The earnings call marked Tim Cook’s final appearance as chief executive; he will become executive chairman in September, with John Ternus, formerly head of hardware engineering, slated to assume the CEO role. Cook described the quarter as Apple’s “strongest June quarter ever” and highlighted the upcoming WWDC26 event, where the company plans to unveil an AI-powered Siri and new child-safety features. Analysts view the leadership change as a seamless handover but note that the memory-chip cost pressure could shape Apple’s near-term financial performance.
Key Figures at a Glance
- Revenue: $109.4 billion (up 16 %)
- Net income: $29.8 billion
- EPS: $2.02 (up 29 %)
- iPhone revenue: $54.25 billion (up 22 %)
- Mac revenue: $10.35 billion (up 29 %)
- Services revenue: $30.74 billion (down to expectations)
- Dividend: $0.27 per share (payable Aug 13)
