Apple posts $111B revenue, $29.6B profit in Q2; beats expectations
What's the story
Apple has announced a stellar performance for the second quarter of fiscal 2026, which ended on March 31. The company reported a revenue of $111.2 billion, beating analysts' expectations of $109.7 billion by a wide margin. This marks a 17% increase from the same period last year and is Apple's best March quarter ever. The company's net profit stood at $29.58 billion while earnings per share jumped by an impressive 22% to $2.01, exceeding estimates of $1.95 per share.
Market reaction
Apple shares surge in after-hours trading
Following the announcement of its record-breaking second quarter results, Apple shares jumped by 4% in after-hours trading to around $282. If the stock closes at this level on Friday, it would be just shy of its December record high. The strong performance was driven by better-than-expected sales across all product categories and a particularly strong showing from Apple's services business.
Business performance
Profit margins expand beyond expectations
Apple's services business, which has a gross margin profile nearly double that of the products category, saw growth accelerate sequentially. The company also managed to expand profit margins for both products and services beyond what analysts were expecting. This is a key factor in Apple's strong financial performance as it indicates the company's ability to manage costs while driving revenue growth across its product and service offerings.
Device count
Record number of active devices
Apple also announced that it has hit a new record with an all-time high installed base of active devices - over 2.5 billion - across all product categories and geographic segments. This is a major milestone for the company and shows its strong market presence in different regions around the world. The high number of active devices also opens up more opportunities for Apple to sell its services, further boosting revenue growth.
Shareholder returns
Board approves $100 billion buyback program
Apple's board has approved another $100 billion buyback program and a 4% increase to the company's cash dividend payout. CFO Kevan Parekh said, "We plan to continue our capital allocation philosophy of first making all the necessary investments needed to support the business and then returning excess cash to shareholders over time." He added that since 2018, they have significantly rightsized their balance sheet and reduced net cash by over $100 billion.