Apple Q4 2026 results: $114.5 billion revenue, R&D up 32% and Siri AI costs
Apple reported revenue of $114.5 billion for its fiscal fourth quarter of 2026, the three months ended September 26, 2026, up 12% from $102.5 billion a year earlier and a record for a September quarter. Diluted earnings per share rose 14% to $2.10 and net income reached $30.7 billion. The results, published on November 2 in Apple's press release and its condensed consolidated financial statements, were the first presented by John Ternus as chief executive.
Behind the headline revenue figure, the financial statements show a sharp acceleration in research and development spending. R&D expense climbed to $11.73 billion in the quarter, 32.3% higher than the $8.87 billion of the same quarter in 2025, while selling, general and administrative costs grew only 5.8%. Chief financial officer Kevan Parekh told analysts on the earnings call that operating expense growth is "driven by increased and continued investment in R&D, in particular AI", and the company's guidance for the December quarter includes, for the first time, costs tied to the ramp of Siri AI.
The quarter also gave the clearest description so far of how Apple intends to run its server-based assistant. Ternus said on the call that "there's going to be some usage limits on features that rely on server-side models, which include Siri AI", and that "anyone who needs greater capacity will be able to purchase expanded access in the future." Apple has not published prices, plan names or the size of those limits.
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APPLE FISCAL Q4 2026 REVENUE BY PRODUCT CATEGORY.
iPhone remained the largest contributor by a wide margin, with $57.58 billion in net sales, up 17.5% year over year and equal to just over half of total revenue. Mac sales grew faster in percentage terms, rising 23.7% to $10.79 billion. Services, which include the App Store, iCloud, Apple Music, AppleCare, advertising and licensing, reached an all-time high of $31.57 billion, up 9.8%.
Two categories declined. iPad sales fell 10.4% to $6.23 billion, and Wearables, Home and Accessories dropped 7.9% to $8.30 billion. Apple said on the call that Mac and iPad supply was constrained, mainly by memory, because demand ran above its expectations, which partly explains the gap between the two computer categories.
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Category | Q4 FY2026 | Q4 FY2025 | Change |
iPhone | $57.58B | $49.03B | +17.5% |
Mac | $10.79B | $8.73B | +23.7% |
iPad | $6.23B | $6.95B | -10.4% |
Wearables, Home and Accessories | $8.30B | $9.01B | -7.9% |
Services | $31.57B | $28.75B | +9.8% |
Total net sales | $114.48B | $102.47B | +11.7% |
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Products cost of sales was $52.06 billion against product revenue of $82.90 billion, which gives a product gross margin of about 37.2%, up from about 36.2% a year earlier on Data Studios' calculation from the reported figures. Services gross margin stayed near 76%. The total gross margin of 47.9% includes roughly one percentage point from tariff refunds, according to the press release, and the $2.10 EPS figure includes $0.05 from the same refunds.
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APPLE Q4 2026 RESULTS BY REGION AND THE GREATER CHINA REBOUND.
Greater China was the fastest-growing region in the quarter. Net sales there rose 21.0% to $17.54 billion, a quarterly record for the region according to Apple, driven mainly by iPhone and Mac. For the full fiscal year, Greater China revenue grew 28.0% to $82.38 billion, the largest percentage gain of any segment.
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Segment | Q4 FY2026 | Q4 FY2025 | Change |
Americas | $48.68B | $44.19B | +10.2% |
Europe | $32.01B | $28.70B | +11.5% |
Greater China | $17.54B | $14.49B | +21.0% |
Japan | $6.54B | $6.64B | -1.4% |
Rest of Asia Pacific | $9.71B | $8.44B | +15.0% |
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The China figure arrives as Apple prepares to bring its first Apple Intelligence features to the country. As covered in our report on Apple Intelligence in China with iOS 27.3 and Alibaba's Qwen, developer testing starts on November 4 and the consumer rollout is planned for December. The September quarter results therefore reflect Chinese demand before any Apple AI features were available there.
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APPLE R&D SPENDING AND AI INVESTMENT IN FISCAL 2026.
The most significant change in Apple's cost structure is in research and development. Over the full fiscal year, R&D expense rose 32.5% to $45.77 billion, an increase of $11.2 billion. R&D as a share of revenue rose from 8.3% in fiscal 2025 to 9.6% in fiscal 2026, and in the fourth quarter alone it reached 10.2% of net sales, compared with 8.7% a year earlier.
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Fiscal year metric | FY2026 | FY2025 | Change |
Net sales | $478.83B | $416.16B | +15.1% |
Research and development | $45.77B | $34.55B | +32.5% |
R&D as share of net sales | 9.6% | 8.3% | +1.3 pts |
Operating income | $158.06B | $133.05B | +18.8% |
Net income | $132.18B | $112.01B | +18.0% |
Diluted EPS | $8.98 | $7.46 | +20.4% |
Capital expenditures | $9.04B | $12.72B | -28.9% |
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Apple does not break R&D down by project, so the financial statements do not show how much of the increase goes to AI models, server infrastructure or other programs. Parekh's comments on the call attributed the growth in operating expenses "in particular" to AI and said Apple will "significantly increase our overall investments in AI." Ternus said that "we feel confident that we are spending what we need to spend to achieve our roadmap."
Capital expenditure moved in the opposite direction. Payments for property, plant and equipment fell to $9.04 billion in fiscal 2026 from $12.72 billion in fiscal 2025, a 28.9% decline. Microsoft, Alphabet and Amazon are spending many times that amount on data centers, as reported in our coverage of Alphabet's Q3 2026 results and Microsoft's fiscal Q1 2027 results. Apple's numbers show a company that is raising its AI spending mainly through operating expenses, with a much smaller physical infrastructure budget than the cloud providers. Apple gave no capital expenditure guidance on the call.
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SIRI AI USAGE LIMITS, PAID EXPANDED ACCESS AND INFERENCE COSTS.
The earnings call added several concrete details about the economics of Siri AI, the server-backed version of Siri that Apple introduced in 2026. Ternus confirmed that features relying on server-side models will have usage limits, and that users who need more capacity will be able to buy expanded access at a later date. He did not say when paid access will launch, what it will cost, or whether it will be bundled with an existing subscription.
Parekh explained how the costs will appear in Apple's accounts. He said that "on the server side, we would have some inference costs" and that "the associated cloud costs will be recognized through services cost of sales." He also said that Apple's "hardware deferrals as of the December quarter will reflect the addition of Siri AI", which means part of the revenue from device sales will be deferred and recognized over time to account for the AI service delivered after purchase. Asked about the balance between on-device and cloud processing, Parekh said Apple is "in very, very early stages of understanding the kind of mix of those costs."
For users, the practical picture is the following. Siri AI comes with supported devices at no announced extra cost, server-dependent requests will be capped at a level Apple has not disclosed, and a paid upgrade for heavier use is planned. Developers and businesses building on Apple Intelligence have no published quota figures to plan around yet. Readers following the rollout of the assistant can find language and regional availability details in our report on Siri AI in five new languages with iOS 27.2, including its continued absence from the European Union.
Ternus described the system as "built on a modern, orchestrator-driven architecture that gives us real room to expand its capabilities over time" and said that "Siri AI is built with essential privacy protections." Apple did not give user numbers, request volumes or engagement figures for Siri AI.
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APPLE DECEMBER QUARTER 2026 GUIDANCE AND MEMORY COSTS.
For the December quarter, Apple expects total revenue to grow 7% to 10% year over year, a range Parekh said "reflects our best view of constrained supply." Services revenue is expected to grow 8% to 9%, with sequential headwinds from third-party licensing and foreign exchange.
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December quarter 2026 guidance | Value |
Total revenue growth | +7% to +10% year over year |
Services revenue growth | +8% to +9% year over year |
Gross margin | 45% to 46% |
Operating expenses | $20.4B to $20.8B (+11% to +13%) |
Other income and expense | About $300M |
Tax rate | About 17% |
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The gross margin guidance of 45% to 46% is well below the 47.9% reported for the September quarter. Parekh said the range includes "primarily the impact of higher memory costs, as well as some costs related to the ramp of Siri AI." Ternus called current memory pricing "unprecedented" and said Apple expects even higher memory costs in the December quarter, partly offset by the price increases Apple applied in June and September, by inventory already purchased and by lower costs for other components. He also said manufacturing purchase obligations increased by $33 billion between June and September as Apple secured supply.
The two cost lines are tied directly to the AI strategy. Running large models on device requires more memory per unit, and running them in the cloud generates inference costs that now flow into services cost of sales. Both pressures appear in the same guidance line.
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APPLE CASH FLOW, BUYBACKS AND BALANCE SHEET AT THE END OF FISCAL 2026.
Operating cash flow was $28 billion in the September quarter and $145.1 billion for the full year, up 30.2% from $111.5 billion in fiscal 2025. Apple returned $28 billion to shareholders in the quarter. Over the year it spent $86.4 billion on share repurchases, down from $90.7 billion, and $15.7 billion on dividends. The board declared a quarterly dividend of $0.27 per share, payable on November 16, 2026, to shareholders of record as of November 12.
At September 26, 2026, Apple held $36.3 billion in cash and cash equivalents, $20.4 billion in current marketable securities and $80.2 billion in non-current marketable securities. Total term debt fell to $78.1 billion from $90.7 billion a year earlier.
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APPLE Q4 2026 EARNINGS: CONFIRMED FIGURES AND OPEN QUESTIONS ON SIRI AI.
The reported figures are unambiguous. Apple closed fiscal 2026 with $478.8 billion in revenue, up 15.1%, a 21.2% increase in iPhone sales for the year, Greater China growth of 28.0% and R&D spending that grew more than twice as fast as revenue. Capital expenditure fell, and the December quarter guidance points to lower gross margins because of memory prices and the cost of serving Siri AI.
Several elements remain undisclosed. Apple has not said how much of its $11.2 billion R&D increase relates to AI, what the Siri AI usage limits will be, when paid expanded access will launch or how much it will cost, or how large the deferred revenue associated with Siri AI will be. The CFO's own description of the cost mix as being at a very early stage suggests those numbers may remain unsettled for at least another quarter. The next reference points will be the December quarter results and any pricing announcement for expanded Siri AI access.
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