Apple Q1 FY2026 Earnings: $143.8B Revenue Smashes Records

Apple just posted one of its best quarters ever. Revenue hit $143.8 billion (up 16% from last year), and earnings per share came in at $2.84 (up 19%). Both numbers beat what analysts were expecting.

The star of the show? The iPhone. Again.

iPhone Sales Go Absolutely Mental

iPhone revenue was $85.3 billion, up 23% year-over-year. That's the highest iPhone revenue Apple has ever reported in a single quarter.

Why the surge? A few reasons:

• The iPhone 17 lineup is selling well (especially the Pro models)
• Apple Intelligence features are finally rolling out properly
• Upgrade cycles are picking up after a few slow years

But here's the kicker: China revenue jumped 38%. That's huge. Apple has been getting hammered in China for the past year by local brands like Huawei, so this is a proper turnaround. Whether it lasts is another question, but for now, Apple is back in the game there.

Services Keep Printing Money

Services revenue (think App Store, iCloud, Apple Music, Apple TV+) hit $30 billion, up 14%. This is Apple's most profitable business — gross margin on services is 76.5%, which is absurd. For every dollar Apple makes from services, 76 cents is profit.

Compare that to products (iPhones, Macs, etc.) where the gross margin is 40.7%. Still good, but services are where the real money is.

Margins Are Strong

Apple's overall gross margin was 48.2%, beating the 47.5% analysts expected. That's up from 47.1% last quarter.

Translation: Apple is making more profit on each product it sells, even after absorbing a $1.4 billion tariff hit this quarter. If tariffs ease up, margins could go even higher.

What Apple Said About Next Quarter

Apple's CFO, Kevan Parekh, guided for:

• Gross margin of 48-49% for Q2 (the current quarter ending in March)
• Operating expenses of $18.4-18.7 billion
• Services growth to stay similar to Q1

Apple didn't give specific revenue growth guidance, but analysts are expecting continued strong performance based on iPhone 17 momentum.

The Bottom Line for Investors

This was a blowout quarter. The iPhone is still Apple's cash cow, China is back on track, and services keep growing. Margins are expanding, which means Apple is getting more efficient.

The stock will likely react well to this — record revenue, strong guidance, and China bouncing back are all things investors wanted to see.

One thing to watch: Apple is still heavily dependent on the iPhone (59% of total revenue). If iPhone sales slow down, the whole business feels it. But for now, the iPhone train is rolling.