Apple approaches $500 billion in annual sales after record iPhone year
Apple generated a record $478.83 billion in annual revenue, led by its strongest year for iPhone sales.
Revenue rose 15% in fiscal 2026, and net income increased 18% to $132.18 billion. But the company’s first earnings report under CEO John Ternus also brought a warning for the holiday season. Apple expects memory shortages to constrain Mac and iPad supplies, with rising component costs taking a larger share of its revenue.
iPhone and services drive the record
Annual iPhone revenue climbed 21% to $254.10 billion, contributing more than half of Apple’s sales. Services reached $123.30 billion, up 13%, and Mac revenue increased approximately 13% to $37.93 billion.
The final quarter delivered revenue of $114.48 billion, up 12% from a year earlier, and net income of $30.71 billion, according to Apple’s financial statements.
| Metric | Fiscal 2026 | Fourth quarter |
|---|---|---|
| Total revenue | $478.83 billion | $114.48 billion |
| Net income | $132.18 billion | $30.71 billion |
| iPhone revenue | $254.10 billion | $57.58 billion |
| Services revenue | $123.30 billion | $31.57 billion |
| Mac revenue | $37.93 billion | $10.79 billion |
Apple reported record annual revenue and September-quarter records for both revenue and net income. Services achieved their highest quarterly revenue ever.
The reporting period ended September 26, capturing the opening days of iPhone 18 Pro and Pro Max sales after their September 18 launch. Most of the new lineup’s first full quarter of sales will appear in the next report.
Memory puts pressure on the holiday quarter
Apple’s supply problems are changing. Chief Operating Officer Sabih Khan said shortages in the September quarter primarily reflected limited access to the advanced manufacturing processes used for Apple’s chips. Those constraints are easing as more products move to newer production technology.
In December, memory is expected to become the main constraint on Mac and iPad supplies because demand has exceeded Apple’s expectations. Khan declined to give a supply outlook beyond that quarter.
Ternus described current memory pricing as unprecedented. Previously purchased inventory is helping absorb the increases, but Apple expects that protection to weaken as prices continue rising.
The balance sheet shows how much Apple’s overall inventory has expanded, reaching $14.54 billion from $5.72 billion a year earlier. That total covers inventory across the business.
Apple forecasts December-quarter gross margin of 45% to 46%, compared with 47.9% in September. Higher memory costs account for most of the underlying decline, with cloud expenses from the Siri AI rollout adding pressure. September’s result also benefited from tariff refunds worth approximately one percentage point.
Earlier product price increases and lower costs for some other components are offsetting part of the impact.
Apple is also working through a separate shortage of iPhone Duo devices. Khan said production is increasing, but the company cannot predict when supply will catch up with demand. The foldable phone went on sale October 23, so its sales were not included in Apple’s record financial year.