Apple Posts a $114.5 Billion September Quarter, Up 12%, but Guides Margins Down to 45% to 46%

Geographically, Greater China grew 21 percent to a quarterly record, the rest of Asia Pacific 15 percent, Europe 11.5 percent and the Americas 10.2 percent; Japan slipped 1.4 percent. Net profit was $30.7 billion against $27.5 billion a year earlier, and for fiscal 2026 net income was $132.2 billion on revenue of $478.8 billion, both records, with full-year earnings per share up 20 percent at $8.98, according to MacRumors.

Why is the margin forecast the story?

Because the quarter just reported got help that will not repeat, and the next one faces costs that will. Apple said the 47.9 percent gross margin included roughly one percentage point of benefit from tariff refunds, worth about five cents of earnings per share. For the December quarter, Parekh guided revenue growth of 7 to 10 percent year over year, Services growth of 8 to 9 percent, operating expenses of $20.4 billion to $20.8 billion and a gross margin of 45 to 46 percent, MacRumors reported. Strip out the one-point tariff benefit and the quarter just reported was closer to 47 percent, so the new range still implies a step down of a point or two, with component costs the pressure the company has flagged all year.

Costs are rising elsewhere too. Operating expenses were $19.2 billion in the quarter, up 21 percent, a faster pace than revenue, and the guide of $20.4 billion to $20.8 billion for December keeps that climb going. Apple also guided other income and expense to about $300 million and a tax rate of about 17 percent. A 7 to 10 percent revenue gain on last year's record December quarter would make this the largest quarter in the company's history, so the question for investors is not whether Apple can sell, but what each sale will earn.

How did Apple stock react?

Softly, at first. The shares had fallen about 1.8 percent in Monday's regular session, part of a broad tech sell-off, and were down roughly another quarter of a percent in the opening minutes of after-hours trade as the numbers landed, MacRumors noted. Apple ended the quarter with $137 billion in cash and marketable securities against $80 billion of debt, and spent $24 billion on buybacks and $3.9 billion on dividends in the three months.

The December quarter is the one that matters for Apple's year, and the company has just told investors it expects its biggest revenue quarter ever while earning less on each dollar of it. Whether the market forgives that trade depends on how long component costs stay elevated and how far Services can keep lifting the mix, two questions the next earnings call in late January will begin to answer.