Apple's iPhone Powers Record Revenue Amid Mac, Wearables Slowdown
Apple capped off a monumental fiscal year with a record-breaking holiday quarter, the company announced Thursday. Global revenue surged 16% year-over-year to $144 billion, marking the strongest growth since 2021. The driver was unmistakable: iPhone sales soared to an all-time high, fueled by robust demand across China, Europe, the Americas, and Japan.
"We're in supply chase mode," CEO Tim Cook told analysts, describing the scramble to meet overwhelming demand for the latest iPhone models. "Customer response, particularly in markets like India where we set a quarterly record, has exceeded our expectations, to say the least."
However, the stellar iPhone performance cast a shadow over other segments. Sales of wearables, home, and accessories—including the Apple Watch and AirPods—dipped by approximately 3%. More notably, Mac computer sales fell by just over 7%, a decline that underscores shifting consumer priorities and a potentially saturated premium PC market.
The earnings call also spotlighted Apple's strategic crossroads in artificial intelligence. Cook remained tight-lipped on the recently unveiled partnership with Google, which will see Google's Gemini AI integrated into future Apple software and Siri updates. "This partnership is crucial," said Jacob Bourne, an analyst with Emarketer. "Apple's smartphone dominance is perhaps more uncertain than ever. They must leverage Gemini to deliver AI that is not just seamless for consumers, but genuinely monetizable."
Financially, Apple plans a $16 billion capital expenditure for the coming year, focusing on retail and infrastructure. This contrasts sharply with rivals like Microsoft, which invested over $37 billion in a single quarter—largely in AI—drawing scrutiny from Wall Street over its spending pace relative to revenue growth.
The market reaction was mixed. Following the report, Apple's stock dipped in after-hours trading, reflecting investor caution amid the segment disparities and strategic questions looming over its AI roadmap.
User Reactions:
Michael R., Tech Portfolio Manager (New York): "The iPhone engine is still firing on all cylinders, especially in growth markets. The Mac dip is a concern, but it feels cyclical. The real story is whether that Google deal can make Siri a contender again. That's the next trillion-dollar question for Apple."
Priya Sharma, Graduate Student (Mumbai): "As someone in a market Apple keeps highlighting, it's exciting to see this focus. The iPhone is a status symbol here, but also a crucial tool. I just hope this growth means better localized services and support, not just sales numbers."
David K., Former Apple Retail Employee (Austin): "This is classic Apple—putting all their eggs in the iPhone basket. A 7% drop in Mac sales isn't a 'dip'; it's a warning sign. And partnering with Google for AI? It feels like an admission that their own innovation engine has stalled. They're becoming a luxury brand that happens to make tech, not a tech pioneer."
Elise Chen, Software Developer (San Francisco): "The conservative capex is smart. Throwing $40 billion at AI like some others isn't a strategy; it's a gamble. If Apple can integrate Gemini thoughtfully and maintain its ecosystem integrity, the AI play could be a slow burn that pays off massively."