Apple’s Earnings Beat Gives John Ternus a Strong Start, but China and Costs Loom
Apple’s Earnings Beat Gives John Ternus a Strong Start, but China and Costs Loom
John Ternus opened his tenure as Apple chief executive with an earnings beat that stood out against a bruising quarter for several major technology companies. Apple reported stronger-than-expected fiscal fourth-quarter revenue after Ternus, who succeeded Tim Cook in September, took charge.
On the analyst call, Ternus framed the period as a product-driven high point. “We just completed one of the most prolific launch periods in our history,” he said, calling it “a remarkable time for innovation across all of our categories.” Revenue reached $114.5 billion, ahead of the $113.46 billion Wall Street expected, while earnings per share of $2.10 also topped the $2 consensus estimate.
The iPhone remained the engine, generating $57.58 billion in revenue versus forecasts of $56.48 billion. Mac sales of $10.79 billion beat estimates by more than $1 billion, and Services came in broadly in line at $31.57 billion. The results included roughly two weeks of iPhone 18 Pro sales, but not sales of the iPhone Duo folding phone, which launched in October.
Yet the quarter carried clear caveats. Greater China revenue was $17.54 billion, missing expectations of $18.75 billion, while iPad sales of $6.23 billion also fell short. Investing.com analyst Jesse Cohen called the China miss “a worrying pattern,” arguing that weakness extended beyond the iPhone to other Apple businesses.
Margins, meanwhile, were helped by tariff refunds. CFO Kevan Parekh said that excluding those refunds, company and product gross margins would each have declined by about a percentage point sequentially, chiefly because of higher memory costs. Ternus acknowledged supply constraints and warned that memory pricing was “unprecedented,” setting up a holiday quarter in which Apple must defend its momentum while absorbing a more expensive supply chain.
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