Apple reported financial results for its fiscal 2026 first quarter ended December 27, 2025, posting quarterly revenue of $143.8 billion, representing a 16% increase year over year.
Management characterized the quarter as record-setting across multiple dimensions, including revenue, earnings, and product performance. The December quarter benefited from strong global demand for core hardware products and continued expansion in Services, positioning the company with momentum entering the remainder of the fiscal year.
#Financial Performance Breakdown
Revenue growth during the quarter was broad-based, with management highlighting iPhone as the largest contributor. Apple stated that iPhone achieved its best-ever quarterly performance, supported by record results across every geographic segment. Services revenue also reached an all-time high, growing 14% year over year, reflecting continued engagement across Apple’s ecosystem.
Profitability improved alongside top-line growth. The company reported diluted EPS of $2.84, representing a new all-time record and a 19% year-over-year increase. According to management, strong operating leverage and margins contributed to earnings growth exceeding revenue expansion. Operating cash flow for the quarter totaled nearly $54 billion, underscoring the company’s ability to convert earnings into cash.
Capital returns remained a notable use of cash flow. Apple returned almost $32 billion to shareholders during the quarter through a combination of dividends and other capital return mechanisms, as disclosed by management. The balance sheet strength and cash generation capacity continue to provide flexibility for shareholder returns.
#Strategic and Operational Highlights
Apple emphasized continued expansion of its installed base, which surpassed 2.5 billion active devices globally during the quarter. Management attributed this milestone to high customer satisfaction across its product and services portfolio. The scale of the installed base supports recurring engagement and monetization opportunities, particularly within Services.
Operationally, the company cited strong execution across product launches and seasonal demand, particularly within iPhone. Services performance reflected ongoing growth across Apple’s digital offerings, reinforcing the strategic importance of ecosystem integration. No specific new product introductions or forward guidance were disclosed in the earnings release, with management focusing instead on execution outcomes and scale achieved during the quarter.
#Management Commentary and Outlook
Chief Executive Officer Tim Cook described the quarter as “record-breaking,” noting that results exceeded internal expectations and were driven by unprecedented iPhone demand and record Services revenue. Cook also highlighted the significance of the growing installed base as a long-term indicator of customer loyalty.
Chief Financial Officer Kevan Parekh emphasized margin strength and cash generation, stating that operating performance enabled Apple to deliver record EPS while maintaining substantial capital returns. While management expressed confidence in current execution, no formal outlook or quantitative guidance was provided.
#Investor Takeaway and Risk Framing
The fiscal Q1 FY26 results reflect strong execution across Apple’s core businesses, with revenue growth, margin performance, and cash flow all reaching record levels.
The quarter underscores the scale advantages of Apple’s ecosystem and the financial impact of its installed base. However, results represent a single reporting period, and future performance remains subject to demand variability, competitive dynamics, and broader macroeconomic conditions.