Apple beats sales but AI costs weigh on holiday gains
AgenciesApple exceeded analysts’ expectations for its latest results on Monday when the iPhone-maker said it notched a “revenue record” for the July-September quarter, driven by iP...
Apple outperformed market predictions in its latest financial results for the July-September quarter, marking a "revenue record" driven by strong iPhone sales and increased services revenue. However, the company's leadership cautioned that rising AI costs may dampen profit margins in the final stretch of the year. CEO John Ternus declared the company's most ambitious lineup yet, including the foldable Duo, for the holiday season.
CFO Kevan Parekh highlighted a projected gross margin between 45 percent and 46 percent, down from 47.9 percent in the previous quarter, primarily due to higher memory costs and AI development expenses. Apple's AI initiative, including its revamped Siri digital assistant powered by Google's Gemini model, aims to incentivize customers to upgrade to newer devices.
The tech giant launched three new phones, two desktop computers, a smart display with Siri AI, and a MacBook Pro with a touchscreen in September. Despite lagging in the AI race, Apple anticipates $11 billion in investments this fiscal year, significantly less than its AI-focused rivals who plan to spend over $700 billion collectively.
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