Apple Revenue Hits $114.5 Billion as Results Beat Analyst Expectations
Key Facts
Apple reported results on November 2 for its fiscal fourth quarter, ended September 26, with revenue of $114.5 billion, up 12% year over year. Diluted earnings per share were $2.10, up 14% from the same period. Both figures topped the analyst averages tracked by a FactSet survey, which were $113.4 billion for revenue and $1.99 per share. The company said its gross margin was 47.9% during the quarter. The results put annual growth in revenue and earnings alongside expectations for a lower margin in the next quarter.
The results beat did not prevent Apple shares from falling on November 2; they closed down 1.8% at $338.32 in regular trading. During the earnings call, the stock fell 2.6% to $329.60. The company had said tariff refunds added $0.05 to diluted earnings per share in the quarter. Apple estimated that those refunds lifted gross margin by about one percentage point. The reported margin of 47.9% therefore included a positive effect from the refunds.
For the next period, Apple forecast a gross margin of between 45% and 46% in the December quarter, compared with 47.9% in the quarter ended in September. The company attributed the expected decline mainly to higher memory costs and expenses related to the Siri AI launch. The margin guidance follows a quarter in which revenue and earnings exceeded analyst averages. The effect of tariff refunds also contributed to gross margin in the reported quarter. Markets are looking ahead to the next quarter in light of the margin range set by the company.
In a separate development in the technology sector, Marvell announced an agreement with Lumentum to form a company focused on optical connectivity, betting on the growing bandwidth needs of AI infrastructure. Marvell said the physical limitations of copper connectivity are accelerating the shift to optical technologies. The company estimated the combined entity's total addressable market at $550 billion by 2030. Once the deal is completed, current Marvell shareholders will own about 67% of the company, compared with about 33% for Lumentum shareholders. Marvell forecast annual run-rate savings of more than $1 billion and said the deal would be accretive to non-GAAP earnings per share beginning in the first year after closing.
Marvell said preliminary revenue for its fiscal third quarter was in line with its previous guidance, narrowing the forecast range to plus or minus 2% around the midpoint of guidance, from plus or minus 5%. The company expects to complete the Lumentum deal in the first half of 2028. Closing remains subject to approval by both companies' shareholders and regulators, as well as customary closing conditions. The expected ownership terms give Marvell shareholders the larger stake in the combined company. The cost savings and the deal's effect on earnings per share are forecasts that the company tied to its completion.