Apple beats estimates as Services hit record, iPhone 17 starts strong

Apple reported stronger-than-expected quarterly results on Thursday and signaled an even bigger holiday quarter ahead, driven by record services revenue and early demand for the iPhone 17 family. For the fiscal fourth quarter ended Sept. 27, Apple said total revenue was $102.5 billion, up 8 percent year over year, with net income of $27.5 billion and diluted earnings per share of $1.85, a 13 percent increase from the prior year.

The company’s Services segment set an all-time quarterly record, generating $28.75 billion, a roughly 15 percent increase from a year earlier. Analysts at Visible Alpha estimate Apple’s Services business will top $100 billion in annual revenue for the first time, projecting about $108.6 billion for the fiscal year that ended in September. JPMorgan analysts said Services could represent roughly a quarter of Apple’s revenue while accounting for as much as half of its profit, reflecting the segment’s higher margins. Services revenue encompasses the App Store, iCloud, Apple Music, Apple TV, Apple Arcade, AppleCare and Apple Pay, and benefits from Apple’s multibillion-dollar agreement with Google to remain the default search engine on Apple devices.