A maker of consumer electronics and digital services, Apple designs the iPhone, Mac, iPad, Apple Watch, and AirPods, and runs platforms like the App Store, Apple Pay, and Apple Card that people use daily around the world. It started in 1976 when Steve Jobs and Steve Wozniak built their first computer, the Apple I, with funding from selling a minibus and a calculator. The name came from Jobs, then on a fruitarian diet, who wanted something "fun and spirited" — sparking a long trademark tussle with the Beatles' Apple Records.
Q3 FY2026 revenue rose 16% to $109.4B with gross margin at 50.1% as iPhone grew 22%
growth held at 22% for a third straight quarter. rose 16% to $109.4B and reached 50.1% as Pro model sales and lifted Products margin, while rose 32% to $11.7B on AI investments. The business is growing on device sales, but component shortages and rising costs now threaten those margins ahead.
Key takeaways
grew 22% to $54.3B in Q3, driven by higher Pro model sales, marking a third consecutive quarter of 22%+ growth after the was flat a year earlier.
Total rose 16% to $109.4B and declined 1.6% from Q2's $111.2B, with up 29% to $10.4B on laptop sales and up 12% to $30.7B from advertising and cloud.
expanded to 50.1% from 46.5% a year ago as Products margin rose to 40.1% on favorable mix and , partially offset by higher memory costs.
Section summaries
Management's Discussion and Analysis
Total net sales rose 16% YoY to $109.4B in Q3 FY2026, driven by iPhone, Mac, and Services growth across all segments.
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grew 22% to $54.3B in Q3, driven by higher sales of , with all geographic segments reporting increases.
surged 29% to $10.4B in Q3 due to higher laptop sales, while declined 6% YoY to $6.2B on lower iPad mini and iPad Air sales.
rose 32% to $11.7B on infrastructure-related costs including AI investments and headcount growth, while the company repurchased $25.8B of stock and paid $4.0B in dividends.
Management expects supply constraints and rising component costs to intensify and pressure future margins, and declined 6% to $6.2B on lower mini and Air sales.
What changed
Q3 FY2026 rose 22% against the 13% Q3 FY2025 increase and the 22% Q2 FY2026 rise, so Pro model growth held rather than reverting toward single digits as prior filings flagged to watch.
reached 50.1%, up from 47.2% in Q3 FY2025 and 49.3% in Q2 FY2026, as lifted Products margin above the 38.7% Q2 level that prior filings said tariff costs were pressuring.
rose 32% to $11.7B, continuing the 32%–34% increases seen in Q1 and Q2 FY2026, tied in this filing to AI infrastructure investments rather than only headcount.
Greater China were not reported for a sixth consecutive quarter since the 11% Q1 FY2025 decline.
EU Article 6(4) probe and the €500M fine under appeal remain open, and a U.S. court order now prevents Apple from charging commission on certain purchases, an update from the prior-period litigation summary.
What to watch
Q4 FY2026 against the 22% Q3 rise to see if Pro model growth holds or reverts toward single digits.
Q4 FY2026 as management expects component shortages and rising costs to intensify and pressure margins.
EU Commission Article 6(4) determination and any additional fine or forced change from the open investigation.
Greater China when next reported, after six quarters of non-disclosure since the 11% Q1 FY2025 decline.
increased 12% to $30.7B in Q3, primarily from higher advertising and cloud services revenue, with flat at 75.6%.
Total expanded to 50.1% from 46.5% a year ago, as Products margin rose to 40.1% on favorable mix and tariff refunds, partially offset by higher memory costs.
R&D expense jumped 32% to $11.7B in Q3, driven by infrastructure-related costs including AI investments and headcount growth.
The company repurchased $25.8B of stock and paid $4.0B in dividends in Q3, and expects supply constraints and rising component costs to intensify, pressuring future margins.
Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes to the Company’s market risk during the first nine months of 2026. For a discussion of the Company’s exposure to market risk, refer to the Company’s market risk disclosures set forth in Part II, Item 7A, “Quantitative and Qualitative Disclosur…
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There have been no material changes to the Company’s market risk during the first nine months of 2026. For a discussion of the Company’s exposure to market risk, refer to the Company’s market risk disclosures set forth in Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” of the 2025 Form 10-K.
Apple faces EU DMA fines and U.S. antitrust litigation, with material financial exposure possible.
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The European Commission fined Apple €500 million on April 23, 2025, for DMA Article 5(4) violations related to steering restrictions; Apple has appealed.
A separate EU DMA Article 6(4) investigation into Apple's contractual requirements for third-party developers could result in fines up to 10% of annual worldwide .
The U.S. DOJ and state attorneys general filed a civil antitrust lawsuit in March 2024 alleging monopolization of smartphone markets; Apple intends to vigorously defend.
In the Epic Games case, a Ninth Circuit order upheld an against Apple's anti-steering rules but allowed some commission on link-out purchases; the Supreme Court granted review on the standard.
Apple states that other ordinary-course proceedings and settled matters did not individually or in the aggregate have a material impact on its financial condition or operating results.
Supply constraints, regulatory pressure, and developer ecosystem risks intensify for Apple in Q3 FY2026.
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Component shortages and rising costs for advanced semiconductors, NAND, and DRAM are expected to intensify, threatening and .
Access to cloud computing and AI infrastructure is constrained industry-wide, risking product delays and higher operating costs.
Regulatory and legal actions, including compliance and U.S. cases, could force business model changes that reduce commissions and licensing .
A U.S. court order currently prevents Apple from charging a commission on certain purchases, and a separate ruling against Google threatens search licensing .
Third-party developer support is at risk due to Apple's minority market share, potentially reducing app availability and quality for its devices.
Evolving global data privacy and online safety laws, including in China, impose complex compliance costs and may limit product features or market access.