Apple posts a record-ready holiday outlook as iPhone 17 demand and Services momentum lift Q4 2025

Apple closed its fiscal year with exactly the kind of numbers Wall Street wants to see heading into the crucial holiday quarter: faster growth in high-margin Services, a steady iPhone upgrade cycle led by the new iPhone 17 family, and guidance that points to fresh all-time records. For the September quarter (Apple’s fiscal Q4 2025), revenue reached $102.47 billion, up 7.9% year over year, while net income surged to $27.47 billion, an eye-popping 90.7% jump versus a year ago. Full-year revenue climbed to $416.16 billion, with net profit of $112.01 billion. Against that backdrop, Apple’s stock ripped higher in after-hours trading, setting the stage for an all-time high when the opening bell rings.

iPhone: a bigger engine, a new lineup, and record holiday ambitions

The headline question each quarter is the same: how did the iPhone perform? From July through September, iPhone revenue hit $49.03 billion – up 6.1% from last year’s comparable period and a new record for Apple’s fiscal Q4 even if it edged under the Street’s more aggressive whisper numbers. For the full fiscal year, iPhone brought in $209.59 billion, a 4.2% increase from fiscal 2024. That’s notable because the iPhone 17 cycle is still in its early innings and Apple’s commentary implies confidence that momentum is building.

Chief executive Tim Cook told investors to expect nothing less than the highest quarterly revenue in Apple’s history for the current period ending in December – Apple’s fiscal Q1 2026. He also guided to the highest iPhone revenue ever in a single quarter, leaning on demand for the new lineup: iPhone 17, iPhone 17 Pro, and iPhone 17 Pro Max. Interestingly, Apple trimmed production of the iPhone Air, but early sell-through suggests the remaining trio is outpacing last year’s iPhone 16 family thanks to a mix shift toward the premium Pro tiers and early adopters who waited for camera and battery gains.

What’s powering the cycle? Beyond the usual camera and performance upgrades, the Pro and Pro Max are benefiting from longer upgrade windows among power users, carrier incentives, and the perception that premium devices hold their value better in a choppy economy. If Apple can maintain that premium skew through December, the average selling price of iPhones (ASP) will climb, and gross margin should follow.

Services: Apple’s second growth pillar smashes another record

If the iPhone is the engine, Services is the torque. Services revenue rose to $28.75 billion in the quarter – up 15.1% year over year – and delivered $109.16 billion for the full fiscal year, a 13.5% increase. That business includes the App Store, AppleCare, Apple TV+, Apple Music, iCloud, and payments. With an installed base of 1.56 billion active iPhones, Services monetization is less tethered to new unit sales and more to usage, subscriptions, and attach rates across that base. The math is straightforward: even modest growth in paid accounts and per-user spend, at Services’ higher margins, can drive outsized profit gains.

There’s also a flywheel in play. Apple rolled out AirPods Pro 3 and a refreshed Apple Watch lineup this fall, and followed with MacBook Pro and iPad Pro models powered by the M5 chip. Each device extends the ecosystem: AirPods make Apple Music stickier; Watch integrates with Fitness and Apple Pay; Macs and iPads lock users into iCloud storage and cross-device continuity. The more seamless the experience, the more predictable the Services revenue stream becomes.

iPad and Wearables: steady iPad, softer wearables, with product catalysts arriving

iPad revenue in fiscal Q4 was $6.95 billion – effectively flat – but the category nudged higher for the full year to $28.02 billion, up about 5%. The new iPad Pro with M5 is pitched squarely at creative pros and frequent travelers, while education and enterprise deployments remain a durable base. The long replacement cycle means spikes often follow meaningful hardware leaps; Apple is positioning the M-series iPads to be exactly that.

Wearables, Home, and Accessories – home to Apple Watch, AirPods, and HomePod – delivered $9.01 billion in the quarter, just a touch below last year’s $9.04 billion. For the full year, revenue was $35.69 billion, down 3.6%. Some softness reflects a maturing smartwatch market and consumers stretching upgrade intervals. Still, with AirPods Pro 3 now in market and the Watch lineup refreshed, attach rates to new iPhones during the holidays will be a key swing factor.

Geography: broad strength with a China wrinkle

Regionally, Apple booked higher revenue in the Americas, Europe, Japan, and the Rest of Asia Pacific during the quarter and across the full year. The exception was Greater China, where sales were slightly lower. That divergence isn’t new – competition, macro headlines, and currency all play a role – but it’s closely watched because China is both a massive market and a vital link in Apple’s supply chain. A modest rebound there would be a meaningful incremental tailwind.

Profitability and EPS: the punchline behind the headline

While top-line growth was solid, the real fireworks came on the bottom line. Diluted EPS jumped from $0.97 a year ago to $1.85 this quarter. For the full year, diluted EPS climbed to $7.49 from $6.08, pushing net profit up 23.2%. Mix (more premium iPhones), Services scale, disciplined operating costs, and ongoing efficiencies in silicon have all helped. CFO Kevan Parekh underscored the theme: Apple closed a record fiscal year with double-digit EPS growth and an all-time high installed base across products and geographies – conditions that make recurring revenue more predictable.

The price-hike debate: are units down or just more expensive?

Not everyone reads the iPhone numbers as a clean win. Skeptics argue that revenue growth overstates true demand because list prices and effective prices have increased in several markets. They point to double-digit price moves this year – roughly 12.5% in the U.S., about 12.9% in China, and roughly 18.1% in Japan – as evidence that average selling price inflation, rather than unit growth, is doing the heavy lifting. Apple, of course, no longer reports unit sales, so the market triangulates from lead times, channel checks, and carrier data. The truth is likely nuanced: higher prices and a richer Pro mix clearly elevate ASPs, but early indications also suggest healthy adoption of the iPhone 17 family even after Apple pared back the iPhone Air.

Investors will parse holiday quarter metrics like delivery windows for the Pro Max, in-store inventory variation by region, and carrier promo aggressiveness. Any sustained constraint on premium models tends to be interpreted as demand exceeding supply – bullish for both units and mix.

What to watch in the holiday quarter

• Premium mix durability: Can Apple maintain elevated Pro/Pro Max share through December?
• Services momentum: Watch paid subscriber gains, payment volumes, and cloud attach as new devices join the ecosystem.
• China trajectory: A stabilization or uptick would improve the story’s balance; further slippage would force tougher comps later.
• Wearables attach: AirPods Pro 3 and Watch upgrades alongside iPhone purchases could flip the wearables narrative.
• Margin cadence: Component costs, currency, and the Services mix will dictate how much of the top-line guidance converts to EPS.

The market’s verdict – so far

Wall Street likes what it sees. Apple shares jumped 2.35% in after-hours trading to $277.78 after closing at $271.40, with traders betting that Cook’s “record quarter” framing will be borne out by Pro-heavy iPhone 17 demand and persistent Services strength. If those pillars hold, Apple enters calendar 2026 with an even larger base of active devices, richer recurring revenue, and the option to surprise with new categories or features when timing is right.

Bottom line: Apple’s quarter wasn’t just about beating a few estimates – it was about confirming that the company has multiple levers to pull. Even with a mixed regional picture and debate over price-driven iPhone revenue, the combination of premium hardware, sticky Services, and disciplined execution produced a powerful exit to fiscal 2025 and a confident stride into the holidays. Record revenue now looks less like a stretch goal and more like the baseline Apple expects to exceed.