Apple (NASDAQ: AAPL) reported a 23% year-over-year increase in iPhone sales for its 2026 fiscal first quarter, which ended on December 27, 2025. The company’s services revenue also saw a boost of 16%, resulting in a gross margin of 48.2%. CEO Tim Cook noted that rising memory costs are a significant challenge, potentially impacting margins in the near term.
While gross margins were above guidance, Cook indicated that Apple is in “supply chase mode” to meet high demand amidst supply constraints. The company anticipates gross margins between 48% to 49% in the next quarter, amid ongoing pressures from device manufacturing, particularly iPhones.
