Mayank Bansal, CFA
Mayank Bansal is a CFA Charterholder and heads the Equity Research team at Kapitales Research, with over 5 years of experience analysing global equity markets. He leads fundamental, data-driven research combining rigorous financial analysis with macro trends.
Can Apple Sustain iPhone Sales Growth as China Revenue Misses Expectations Despite Earnings Beat?
Highlights:
Apple Delivers Strong Fourth-Quarter Earnings
Apple Inc. reported stronger-than-anticipated fiscal fourth-quarter results on 2 November 2026, supported by robust iPhone demand and expanding services revenue. However, disappointing sales relative to expectations in China and rising component costs tempered investor enthusiasm.
Revenue increased 12% year-on-year to US$114.48 billion, exceeding Wall Street's forecast of approximately US$113.4 billion. Net income advanced to US$30.71 billion, while diluted earnings per share reached US$2.10, surpassing expectations of approximately US$2.00.
iPhone Sales Drive Revenue Growth
Apple's flagship smartphone business remained its primary growth engine, supported by demand for premium devices.
Key quarterly figures included:
Meanwhile, iPad revenue declined to US$6.23 billion, while wearables and accessories generated US$8.30 billion.
China Sales Miss Market Expectations
Greater China revenue reached approximately US$17.5 billion, representing annual growth of around 20%. Nevertheless, the figure missed analysts' projections, highlighting the challenges of meeting elevated market expectations. Supply constraints also restricted product availability, complicating Apple's efforts to capture demand across important international markets.
Outlook: Can Apple Maintain Momentum?
Apple anticipates revenue growth of 7%–10% during the December quarter, supported by its latest product launches and holiday demand. However, increasing memory-chip prices could compress gross margins to approximately 45%–46%, creating additional profitability challenges.
Under newly appointed CEO John Ternus, Apple's performance will increasingly depend on sustained iPhone demand, improved product availability and effective cost management. Although strong earnings demonstrate continued business resilience, China's performance and escalating production expenses remain critical factors shaping Apple's near-term growth prospects.
Note- All data presented is based on information available at the time of writing.
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