INTEL: Apple drops 4% after hours despite Q4 beat as services slow, memory costs rise
Update (03 Nov 2026): Added Apple’s fiscal first-quarter guidance (services growth of 8% to 9%, gross margin of 45% to 46%), the 4% postmarket share drop, and the CEO’s comment that memory costs will keep rising past December.
Apple shares fell 4% in postmarket trading even though fourth-quarter results beat forecasts, as guidance pointed to slower services growth and management said memory costs will keep rising. Revenue was $114.48 billion, ahead of the roughly $113.39 billion analysts expected, and earnings per share were $2.10 against an estimate of $1.99. Revenue growth slowed to 12%, the slowest of the fiscal year.
Guidance points to slower services growth
Apple forecast fiscal first-quarter services revenue growth of 8% to 9% and a gross margin of 45% to 46%. Services revenue in the fourth quarter was $31.57 billion, essentially in line with an estimate of $31.58 billion. Growth in the segment came in below 10%, the first slowdown in three years, and the guided range suggests it will slow further.
iPhone drives the beat
iPhone sales were $57.58 billion, compared with an expected figure of about $56.5 billion, making the iPhone line the clearest source of the revenue beat. Greater China revenue was $17.54 billion.
Memory costs and inventory
Apple’s inventory rose 31.1% to $14.54 billion. The CEO said memory costs will keep rising past December, a pressure that bears on the gross margin range Apple has guided to.
Buybacks, tariff refund and underlying EPS
Apple bought back $24 billion of its shares in the quarter, a drop in buybacks. The EPS figure includes a $0.05 per share benefit from a tariff refund. Without it, earnings would have been about $2.05, still above the consensus estimate. Apple’s CFO said most of the company’s tariff refunds have been received. The refund is a one-off item, so the headline earnings beat is slightly larger than the underlying one.
Apple published the results in its fourth-quarter earnings release. Shares trade under the ticker $AAPL.
