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Apple beat revenue and profit estimates, fueled by strong growth in services revenue and modest gains in iPhone sales.
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The company made progress shifting U.S. production out of China but faces challenges selling its phones and other electronics in that important market.
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Apple remains a cash-generation machine, upping both its dividend and share-repurchase authorization.
Here’s our initial take on Apple‘s (NASDAQ: AAPL) financial report.
|
Metric |
Q2 2024 |
Q2 2025 |
Change |
vs. Expectations |
|---|---|---|---|---|
|
Revenue |
$90.8 billion |
$95.4 billion |
5% |
Beat |
|
Earnings per share |
$1.53 |
$1.65 |
8% |
Beat |
|
iPhone revenue |
$46.0 billion |
$46.8 billion |
2% |
n/a |
|
Services revenue |
$23.9 billion |
$26.6 billion |
12% |
n/a |
Investor focus coming into this quarter centered on how Apple is navigating ongoing trade wars. The answer was a mixed message.
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First, the good news: Apple said a majority of its devices shipped into the U.S. in the June quarter will originate from India and Vietnam, alleviating concerns about how China-focused tariffs would eat into profits in 2025. But Apple also said that China revenue fell by more than 2% to $16 billion in its fiscal second quarter, falling slightly below analyst expectations.
Overall, the quarter was solid. Apple grew revenue by 5% and earnings per share by 8%, topping analyst estimates. Overall iPhone sales were up slightly, while services revenue posted solid 12% year-over-year gains.
Apple generated $24 billion in operating cash flow in the quarter and continues to boost the cash it is returning to shareholders. The company announced a new $100 billion share-repurchase program and said it is boosting its quarterly dividend by 4% to $0.26 per share.
Apple shares were down nearly 15% year to date heading into earnings, and the latest results were not enough to turn the momentum favorable. Apple shares were down 2% in after-market trading after the release of earnings but ahead of the company’s call with investors.
The comments on sourcing iPhones outside of China will come as a relief, but investors are likely to still have questions about what lies ahead for Apple. A shift toward local brands in China could accelerate if U.S.-branded products lose favor due to ongoing trade tensions, a potential worry given that iPhone sales still account for roughly half of overall revenue.
