Record High in Revenue and Profit
Apple Inc. released its fourth-quarter fiscal 2025 report, with total revenue exceeding $102.4 billion, up 8% year-over-year, and net profit soaring to $27.5 billion, a massive 86% increase year-over-year, marking the best quarterly performance in five years. Despite a slight 4% decline in Greater China revenue, overall profitability exceeded market expectations with a gross margin remaining high at 47.2%, reflecting advantages in product structure and cost control.
CFO Kevin Peric noted in the earnings call that although the cost structure of new products is higher, the strong product mix offsets the pressures from rising raw material prices. With optimization in manufacturing and supply chain improvements, Apple expects the next quarter's gross margin to climb further to around 47.5%.
iPhone 17 Series Leads Global Trend
Tim Cook emphasized in the analyst call that the success of the iPhone 17 series is entirely due to product innovation and enhanced user experience. The Pro version won the high-end market's favor with professional-grade imaging and performance, while the lightweight iPhone Air captured the young demographic's preference. Due to high demand, some models are experiencing supply shortages in multiple markets, and Apple is accelerating supply increases.
Cook revealed that Chinese consumers have responded especially positively to the iPhone 17, with a significant increase in store traffic. He expects that as supply improves, Greater China sales will rebound in the next fiscal quarter.
Service Business Becomes Second Growth Engine
Apart from hardware, Apple's service business continues to demonstrate resilience. This segment's revenue reached $28.8 billion this fiscal quarter, a 14% year-over-year increase, setting a new record high. Peric stated that the growth is not reliant on tax or litigation gains but rather the natural expansion of diversified businesses. Strong contributions from services like Apple One, AppleCare, and advertising and subscription revenues were noted.
Analysts believe that Apple's breadth in the service domain and user ecosystem stickiness will be key sources of future profitability. Company management reiterated plans to continue expanding the service layout and strengthening privacy and compliance guarantees to enhance overall user trust.
Chinese Market: Short-term Supply Constraints
Apple's quarterly revenue in Greater China decreased by 4%, primarily due to limited supply of certain iPhone models. Cook explained this issue is not due to insufficient capacity but rather demand exceeding expectations. With the official launch of iPhone Air in China, the company anticipates a recovery in December's quarter growth.
He also mentioned China's electronics consumption subsidy policy, which has somewhat boosted sales, particularly in the mid-range models. Although some Apple products exceed the subsidy price cap, the policy has generally stimulated consumer sentiment, creating a positive impact on market recovery.
Investment Layout and Future Outlook
Peric confirmed that Apple will significantly increase its investment in artificial intelligence in the new fiscal year while continuing to enhance product R&D and ecosystem integration. The additional operating expenditures will mainly be directed towards AI algorithms, chip optimization, and device-end smart feature development.
He emphasized that although the growth rate of operating expenses is higher than that of income growth, the company will maintain profitability growth through a solid gross margin and high operational leverage.
Looking ahead, Apple expects to launch new applications in the AI, mixed reality, and health technology fields early in fiscal 2026 to further expand the service ecosystem. Cook stated: "We are at the beginning of a new wave of innovation that will redefine Apple's growth trajectory."
