A fixed rule set over this filing's XBRL figures and the number of high-severity risks found in it — no model judgement.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
Apple Inc. reported Q3 FY2026 revenue of $109.42B (up 16.4% YoY) and net income of $29.79B (up 27.1% YoY), driven by strong iPhone Pro and Mac growth alongside expanding gross margins to 50.1%, despite memory cost pressures and ongoing regulatory scrutiny.
Revenue
$109.42B
+16.36% YoY
EPS (Diluted)
$2.02
+28.66% YoY
Gross Margin
50.1%
+3.6 pts YoY
Operating Income
$35.7B
+26.57% YoY
Filed · Source: SEC EDGAR 10-Q filing
Apple (AAPL) reported Q3 FY2026 revenue of $109.42B, up 16.4% year over year. The company posted net income of $29.79B, up 27.1% from a year earlier, with diluted EPS of $2.02. Gross margin was 50.1%. Operating income was $35.7B, up 26.6% year over year. AAPL's fiscal Q3 FY2026 corresponds to calendar Q2 2026.
Apple reported strong Q3 FY2026 performance with 16.4% YoY revenue growth to $109.42B and 27.1% net income growth to $29.79B, driven by iPhone Pro sales and 50.1% gross margins.
Last 4 quarters: 3 beats, 1 miss
Total net sales rose 16% YoY to $109.42B in Q3 FY2026, led by iPhone net sales increasing 22% to $54.25B due to strong Pro model demand, Mac sales jumping 29% to $10.35B from laptop demand, and Services growing 12% to $30.74B behind advertising and cloud services, while iPad net sales fell 6% to $6.19B.
Source: Form 10-Q Item 2 MD&A, p.15
Revenue grew across all geographic segments in Q3 FY2026: Americas rose 11% YoY to $45.78B, Europe surged 22% to $29.40B, Greater China gained 22% to $18.82B supported by foreign currency strength, Japan grew 13% to $6.55B, and Rest of Asia Pacific increased 16% to $8.87B.
Source: Form 10-Q Item 2 MD&A, p.14
Total gross margin percentage expanded by 3.6 percentage points YoY to 50.1% ($54.77B), driven by a Products gross margin increase to 40.1% (up from 34.5% YoY) due to favorable product mix and tariff refunds, partially offset by higher memory (NAND/DRAM) costs; Services gross margin remained elevated at 75.6%.
Source: Form 10-Q Item 2 MD&A, p.16
Research and development expenses jumped 32% YoY to $11.73B (11% of net sales), driven primarily by increased infrastructure-related costs and investments in artificial intelligence, including Siri AI announced alongside iOS 27 and macOS 27 Golden Gate.
Source: Form 10-Q Item 2 MD&A, p.13-17
Apple generated $116.00B in cumulative YTD operating cash flow and returned significant capital to shareholders during Q3 FY2026, including $25.8B in share buybacks and $4.0B in dividends; the company also paid off its remaining $8.8B deemed repatriation tax liability during the first nine months.
Source: Form 10-Q Item 2 MD&A, p.18
Apple is experiencing component supply constraints and cost increases for advanced semiconductors, DRAM, and NAND memory, which management expects to intensify. Furthermore, expanding AI features like Siri AI requires substantial compute capacity, creating risk if third-party cloud provider capacity cannot be secured on commercially reasonable terms.
Source: Form 10-Q Item 1A Risk Factors, p.21
Global antitrust regulations and court orders, such as the EU Digital Markets Act (DMA), require Apple to allow alternative app stores, payment systems, and interoperability. Compliance measures add security risks, engineering overhead, and threaten high-margin App Store commission streams.
Source: Form 10-Q Item 1A Risk Factors, p.22
Apple earns significant revenue from licensing search distribution on its platforms, primarily to Google. Following an August 2024 court ruling finding Google in violation of U.S. antitrust laws, pending DC District Court remedies or appeals could prohibit Google from paying commercial terms for search distribution, severely impacting revenue.
Source: Form 10-Q Item 1A Risk Factors, p.23
Apple relies on third-party developers to maintain attractive software ecosystems. If developers shift focus to competing platforms or adopt direct-to-consumer distribution models to bypass App Store commissions, Apple's device demand and high-margin services income could suffer.
Source: Form 10-Q Item 1A Risk Factors, p.21-22
This analysis does not extract a guidance section. Companies issue revenue and EPS outlook in the 8-K press release and on the earnings call rather than in the 10-Q itself — though the filing's management discussion can contain forward-looking statements, which appear in the highlights above where they were material.
See the AAPL earnings preview — expected date, analyst estimates and what to watch →
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $109.42B | $94.04B | +16.36% |
Cost of Revenue | $54.65B | $50.32B | +8.60% |
Gross Profit | $54.77B | $43.72B | +25.28% |
Operating Income | $35.7B | $28.2B | +26.57% |
Net Income | $29.79B | $23.43B | +27.12% |
EPS (Basic) | $2.03 | $1.57 | +29.30% |
EPS (Diluted) | $2.02 | $1.57 | +28.66% |
R&D Expense | $11.73B | $8.87B | +32.29% |
SG&A Expense | $7.35B | $6.65B | +10.47% |
Apple delivered strong financial results in Q3 FY2026, generating $109.42B in revenue (up 16.4% YoY) and $29.79B in net income (up 27.1% YoY). Diluted EPS reached $2.02, up 28.7% YoY, driven by strong demand for iPhone Pro models and expanding gross margins.
Key takeaways include 50.1% total gross margin driven by favorable product mix and tariff refunds, 22% growth in iPhone sales to $54.25B, and 12% growth in Services to $30.74B. Additionally, R&D expenses jumped 32% YoY to $11.73B as Apple increased investments in AI capabilities.
Apple warned of intensifying supply constraints and cost inflation for advanced semiconductors, DRAM, and NAND storage, alongside cloud compute capacity risks for Siri AI. Management also cited regulatory threats from the EU Digital Markets Act and potential loss of Google search licensing revenue due to antitrust rulings.
Apple's revenue grew 16.4% YoY to $109.42B, led by 22% growth in iPhone ($54.25B), 29% growth in Mac ($10.35B), and 12% growth in Services ($30.74B). Geographically, sales were boosted by 22% growth in both Europe and Greater China.
Expected release date, analyst estimates & what to watch
Apple delivered a standout Q2 FY2026 with revenue surging 16.6% YoY to $111.2B and net income climbing 19.4% to $29.6B, driven by record gross margins of 49.3% and accelerating R&D investment of $11.4B.
Apple delivered a strong fiscal Q4 2025, with revenue surging 15.7% YoY to $143.8B, net income rising 15.9% to $42.1B, and operating cash flow jumping 80.1% to $53.9B, reflecting broad-based growth and expanding margins.
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