Apple announced Thursday that it achieved record-breaking iPhone sales in the final quarter of last year, fueling its strongest revenue growth since 2021.
The company’s overall revenue surged by 16% year-over-year to $144 billion, driven by significant sales increases in China, Europe, the Americas, and Japan. This performance was led overwhelmingly by the iPhone, with CEO Tim Cook stating that demand for the latest model “exceeded our expectations, to say the least.” He noted that sales in India also reached a new quarterly record.
Despite the smartphone success, other segments showed weakness. Sales of wearables and accessories—including the Apple Watch and AirPods—fell by approximately 3%, while Mac computer revenue declined by just over 7%.
On an analyst call, Cook described the company as being in “supply chase mode” to meet the high demand for iPhones. However, he declined to comment on specifics regarding Apple’s recently announced AI partnership with Google, which will integrate Google’s Gemini technology into future Apple AI models and Siri.
According to Jacob Bourne, an analyst at Emarketer, Apple’s dominant smartphone position is “perhaps more uncertain than ever.” He emphasized that the company must leverage its Gemini collaboration to make Siri “relevant, seamless, and monetizable.”
While planning to invest $16 billion in the coming year on retail and infrastructure, Apple’s capital spending remains notably conservative compared to rivals like Microsoft, which invested over $37 billion last quarter largely in AI. Wall Street has recently expressed concern over heavy AI spending without proportional revenue growth—an issue underscored when Microsoft’s stock fell 10% Thursday after its earnings report.
Apple’s focus remains on its core hardware ecosystem even as it navigates new AI partnerships to shape its future software capabilities.
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