Apple Reports Strongest Revenue Growth Since 2021

Apple (AAPL) has reported its best revenue growth since 2021. For this year’s second quarter, the consumer electronics giant announced sales of $94.04 billion U.S., beating Wall Street forecasts of $89.53 billion U.S. The revenue was up 10% from a year earlier, its biggest quarterly growth since December 2021. The Silicon Valley-based company also reported earnings per share (EPS) of $1.57 U.S., which was ahead of consensus estimates that called for a profit of $1.43 U.S. Importantly, Apple reported iPhone sales of $44.58 billion U.S., which topped the $40.22 billion U.S. expected on Wall Street. iPhone sales grew 13% year-over-year in the period. Apple’s Services revenue, which includes the streaming platform and payments app, totaled $27.42 billion U.S., which beat consensus expectations of $26.80 billion U.S. Apple said its gross margin for the quarter was 46.5%, which surpassed forecasts of 45.9%. The company doesn’t provide formal guidance as part of its quarterly print, but management fielded questions from media on an earnings call. Most of the questions focused on artificial intelligence (A.I.), an area where Apple has been viewed as a laggard by Wall Street. Apple Chief Executive Officer (CEO) Tim Cook sought to reassure investors, saying the company plans to increase its A.I. spending and is “open to M&A that accelerates our roadmap.” Some analysts have been calling on Apple to make strategic acquisitions to bolster it’s A.I. offerings, with many singling out start-up Perplexity AI as a potential target. However, Cook remained non-committal on the earnings call. Apple is on pace to spend about $14 billion U.S. in capital expenditures this year. That’s a fraction of the capex being spent by other technology giants in 2025. Alphabet has committed to spend $85 billion U.S. on A.I. this year, while Amazon is spending $100 billion U.S. AAPL stock was up 2% in after hours trading following its latest print. Year-to-date, the stock is down 15% and trading at $207.57 U.S. per share.