Apple Q3 2025 Earnings Summary: Strong iPhone, Mac, and Services Growth Drive Resilient Performance
Apple Delivers Strong Growth Across iPhone, Mac, and Services with Some Momentum in AI
Apple delivered a strong June quarter, with revenue of $94.0 billion, beating expectations and rising 10% year-over-year. Growth was driven by double-digit increases in iPhone, Mac, and Services. EPS of $1.57 set a new Q3 record, growing 12% YoY. iPhone revenue surged 13% to $44.6 billion, fueled by the strong performance of the iPhone 16 family and broad-based demand across all regions, including significant growth in emerging markets. Mac revenue rose 15% to $8.0 billion, reflecting strong demand for M4-powered MacBook Air and record Mac upgrade activity. While iPad (-8%) and wearables (-9%) showed weakness due to tough year-over-year comparisons, the installed base across all product lines reached new all-time highs.
Key Financial Highlights
Revenue: $94.0 billion, up 10% YoY
iPhone Revenue: $44.6 billion, up 13% YoY
Mac Revenue: $8.0 billion, up 15% YoY
Services Revenue: $27.4 billion, up 13% YoY
Gross Margin: 46.5%, near the top of guidance
EPS: $1.57, up 12% YoY
Net Cash: $31 billion
Shareholder Returns: $27 billion via dividends and buybacks
Services and AI Momentum
Services revenue was a standout, growing 13% YoY to reach $27.4 billion, an all-time high. The company saw strong momentum across the App Store, cloud services, Apple TV+, and Music, with more than 1 billion paid subscriptions now on its platform. The services segment continues to show robust pricing power, with rising customer engagement and average revenue per user.
Apple is also making significant strides in AI with the rollout of “Apple Intelligence,” its integrated, privacy-focused generative AI features. These are embedded across iOS 26, macOS, and iPadOS, and will run on-device as well as in the cloud via Apple Silicon-powered servers. Apple positioned itself as offering the most accessible, secure, and user-friendly AI experience in consumer tech, with developer response to the new features, including live translation and AI-assisted writing/editing tools, being strong.
Outlook and Financial Discipline
Apple provided solid guidance for Q4, forecasting mid- to high-single-digit revenue growth and gross margin in the 46–47% range, despite an additional ~$1.1 billion in tariff-related costs. Operating expenses are expected to rise modestly to $15.6–$15.8 billion. Despite the continued impact of tariffs, Apple’s broad global exposure, strong brand, and ongoing product cycle strength position it well for the upcoming fall iPhone and software refresh.
Here’s Our Take
Apple’s Q3 2025 results reflect the company’s resilient growth across its core products, particularly iPhone and Mac, as well as its continued strength in Services. The company’s integration of AI into its ecosystem, coupled with strong momentum in its services business, underscores its position as a leader in consumer technology. While tariffs and weaker iPad/wearables sales may present near-term challenges, Apple’s ability to generate strong cash flow, return capital to shareholders, and innovate across product categories positions it well for the future.
We remain optimistic about the company’s long-term growth potential, supported by its solid execution, strong brand, and growing leadership in AI. Despite macro and regulatory headwinds, it remains a high-quality compounder and continues to be a core holding in portfolios.
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