Apple’s AI-enabled iPhone drove fourth-quarter sales above Wall Street expectations, but a cautious holiday revenue forecast has raised concerns. A decline in China sales during the quarter also affected some investor sentiment, resulting in a 1.4% drop in after-hours trading despite higher-than-expected profit and revenue.
Apple expects revenue to grow at a low to mid-single-digit rate for the first quarter ending in December, falling short of analysts’ forecast of 6.65% growth. While Apple anticipates double-digit growth in its services, the company did not address hardware performance projections, including the iPhone in China, where new AI features are still unavailable.
Fourth-quarter revenue reached $94.93 billion, with iPhone sales up 5.5% to $46.22 billion, slightly above estimates. Services, Mac, and iPad sales were below analyst expectations. New Apple Intelligence features were positively received, though delays in some have led analysts to question the potential impact on upgrade rates.
Apple’s AI features are integrated into its operating systems, mostly available on iPhone 16 models. Capital spending rose to $9.45 billion, with a focus on data center partnerships. Services like iCloud generated $24.97 billion, slightly below forecasts, while earnings per share, including a one-time EU tax, were $0.97.
