Apple Shares Surge on Stellar Quarterly Performance

Apple Inc. has kicked off its 2026 fiscal year with a powerful earnings report, shattering market expectations. The technology giant announced quarterly revenue of $143.8 billion, marking a substantial 16% year-over-year increase and comfortably exceeding analyst projections of $138.5 billion. This robust performance was fueled by exceptional demand for its flagship iPhone and a significant rebound in the critical Chinese market.

The company's profitability metrics impressed investors. Earnings per share jumped 19% to $2.84, decisively beating the consensus forecast range of $2.65 to $2.67. Net income for the period reached $42.1 billion. In a move to return value to shareholders, Apple's board declared a cash dividend of $0.26 per share. This dividend will be payable on February 12 to shareholders of record as of February 9.

Record iPhone Sales and a Resurgent China

Central to the quarter's success was the iPhone segment, which generated record revenue of $85.3 billion—a remarkable 23% surge. CEO Tim Cook attributed this to "unprecedented demand" for the latest generation of devices, which drove upgrade cycles to new highs across all geographic regions.

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Perhaps the most striking turnaround occurred in Greater China, where revenue leaped 38% to $25.5 billion. This performance alleviates recent concerns about Apple's position in this major market. The Services division, a consistent contributor to the company's high margins, also posted strong results with revenue of $30 billion, representing 14% growth.

Guidance and Analyst Sentiment

Looking ahead to its second fiscal quarter ending in March 2026, Apple provided an optimistic revenue growth forecast of 13% to 16%, which sits above many current Wall Street estimates. However, management tempered this outlook with notes of caution. The company highlighted rising component costs, particularly for memory chips used in AI-capable devices, which could pressure gross margins. Supply constraints were also cited as a factor potentially limiting the company's ability to meet the intense demand for its newest iPhone models.

Market analysts responded favorably to the report. On Friday, Bank of America reaffirmed its "Buy" rating with a $325 price target, while Morgan Stanley maintained its "Overweight" stance and a $315 target. Wedbush Securities was notably bullish, suggesting a "potentially monumental year" for Apple's AI strategy and setting a $350 price target. Morningstar raised its fair value estimate for the stock from $240 to $260.