Apple today announced financial results for the first fiscal quarter of 2025, which corresponds to the fourth calendar quarter of 2024.
For the quarter, Apple posted revenue of $124.3 billion and net quarterly profit of $36.3 billion, or $2.40 per diluted share, compared to revenue of $119.6 billion and net quarterly profit of $33.9 billion, or $2.18 per diluted share, in the year-ago quarter.
Apple set all-time records during the quarter for total revenue, earnings per share, and services revenue. Total revenue was up 4 percent year-over-year, while earnings per share rose by 10 percent. Services, Mac, and iPad revenue figures were all up significantly year-over-year, while iPhone and Wearables saw small declines.
Gross margin for the quarter was 46.9 percent, compared to 45.9 percent in the year-ago quarter. Apple also declared a quarterly dividend payment of $0.25 per share, payable on February 13 to shareholders of record as of February 10.
"Today Apple is reporting our best quarter ever, with revenue of $124.3 billion, up 4 percent from a year ago," said Tim Cook, Apple's CEO. "We were thrilled to bring customers our best-ever lineup of products and services during the holiday season. Through the power of Apple silicon, we're unlocking new possibilities for our users with Apple Intelligence, which makes apps and experiences even better and more personal. And we're excited that Apple Intelligence will be available in even more languages this April."
As has been the case for over four years now, Apple is once again not issuing guidance for the current quarter ending in March.
Apple will provide live streaming of its fiscal Q1 2025 financial results conference call at 2:00 pm Pacific, and MacRumors will update this story with coverage of the conference call highlights.
Conference call recap ahead...
1:41 pm: "Our record revenue and strong operating margins drove EPS to a new all-time record with double-digit growth and allowed us to return over $30 billion to shareholders," said Kevan Parekh, Apple's CFO. "We are also pleased that our installed base of active devices has reached a new all-time high across all products and geographic segments."
1:46 pm: Apple saw strength in several product categories, with Services revenue rising 13.9% year-over-year to $26.3 billion, while Mac revenue was up 15.5% to $9.0 billion and iPad revenue was up 15.2% to $8.1 billion. Those gains more than offset dips of 0.8% in iPhone to $69.1 billion and 1.7% in Wearables, Home and Accessories to $11.7 billion.
1:47 pm: After declining around 0.75% in regular trading today ahead of the earnings release, Apple's share price has been bouncing around a bit following the release and is currently up around 0.25%.
1:56 pm: The hold music is live ahead of the quarterly earnings call with analysts at 5 p.m. EST / 2 p.m. PST. Expected on the call is Apple CEO Tim Cook and, for the first time, the company's new CFO, Kevan Parekh, who took over from Luca Maestri on Jan. 1, 2025.
2:00 pm: The call is beginning with the standard earnings call disclosures about forward looking statements from Suhasini Chandramouli, Apple's Director of Investor Relations.
2:02 pm: Tim is on, taking a moment to acknowledge the wildfires that impacted Los Angeles earlier this month. "LA is home to many of our team members... we are contributing to the relief efforts and we are continuing to support our teams and the local community."
2:03 pm: Apple made $124.3 billion, up 4% from last year and an all-time record. Earnings per share were $2.40, up 10% from last year, with all-time records across most countries and regions, including the Americas, Europe, Japan and the rest of Asia-Pacific. It also set records in Latin America, the Middle East and South Asia.
2:03 pm: Services set an all-time revenue record and the company has made almost $100 billion in revenue from services in the last year, and it has 2.35 billion active devices.
2:05 pm: He's talking up Apple Intelligence, noting the countries that it's expanded to during the quarter since its launch in October, and upcoming language support including French, German, Italian, Portuguese, Spanish, Japanese, Korean and simplified Chinese as well as localized English to Singapore and India.
2:06 pm: He also cites privacy, claiming that "Apple intelligence is a breakthrough for privacy and AI with innovations like private cloud compute, which extends the industry leading security and privacy of Apple devices into the cloud."
2:06 pm: Now we're moving to results, starting with iPhone, at $69.1 billion, reaching iPhone revenue records in "dozens of markets and regions."
2:07 pm: Mac revenue was $9 billion, up 16% year over year, driven by "significant excitement around the world for our latest Mac lineup."
2:07 pm: "It's a launch pad to enable users to bring their best ideas and boldest creations to life."
2:08 pm: "Every product in the Mac lineup offers something extraordinary, whether that's the super portable MacBook Air, the powerhouse MacBook Pro, the world's best all in one iMac, or the small wonder that is the Mac Mini, which is not only stunningly capable, but as our first carbon neutral, Mac. All of this is enabled by the unparalleled power of Apple silicon."
2:08 pm: iPad revenue was $8.1 billion, up 15% from last year.
2:08 pm: Wearables, Home and Accessories revenue was $11.7 billion, thanks in part to the new Apple Watch Series 10.
2:09 pm: "Health Innovation has long been a focus for us, and we're committed to continuing to advance this work, because we know how much it matters to our users." He mentions new hearing health features on AirPods Pro and sleep apnea notifications.
2:10 pm: Apple Vision Pro came to more countries as well! "Users are enjoying incredible immersive entertainment experiences and powerful new features and enhancements to Mac virtual display."
2:10 pm: Services set an all-time revenue record of $26.3 billion, growing 14% from last year. All-time records in the Americas, Europe, Rest of Asia-Pacific, and a December-quarter record in Japan.
2:11 pm: "Five years since launch Apple TV plus continues to be home to incredible story telling that viewers love. There's nothing quite like the anticipation that comes when a fan favorite returns, and we were thrilled to debut the second season of Severance earlier this month."
Formula One starring Brad Pitt will debut on June 27.
2:11 pm: Apple TV+ productions have earned more than 2,500 nominations and 538 wins.
2:11 pm: Users can also share AirTag locations with various airlines to help them reunite their bags.
2:12 pm: New retail stores also opened in China, Spain and the US. A fifth store will be coming to the UAE later this year, and the online store is coming to Saudi Arabia. Flagship stores will begin opening in Saudi Arabia in 2026.
2:13 pm: "Every day I get deeply moving notes about the many ways our technology is enriching our users lives. I recently got a note from a customer who put his watch on his father's wrist with when he feared something was wrong with him. The watch alerted them that the father was in afib, and they were able to get him to the hospital for potentially lifesaving treatment."
2:13 pm: "There are so many touching notes around the profound impact of our new hearing health feature. Like a recent user who told me it had changed her life, allowing her to take part in conversations with her children and grandchildren."
2:14 pm: Kevan Parekh is taking over the call for the first time.
2:15 pm: "We are very pleased to report an all-time high for revenue. With December quarter revenue of $124.3 billion, up 4% year over year, achieved all time revenue records in the Americas, Europe, Japan and rest of Asia Pacific and grew in the vast majority of markets we track. Products revenue was $98 billion, up 2% year over year, driven by growth from iPad and Mac. Thanks for our incredible customer satisfaction and strong loyalty, our install base of active devices, reached an all time high across all products and geographic segments, and is now over 2.35 billion active devices."
Products gross margin was 39.3%, up 300 basis points sequentially. Services margin was 75%, up 100 basis points thanks to mix. Gross margin was 46.9 overall, up 70bp.
2:16 pm: This strong business performance resulted in all time records for both net income at $36.3 billion and diluted earnings per share of $2.40, up 10% year over year.
2:17 pm: iPhone "grew in the majority of markets we track and reached all time revenue records in several developed markets, including Canada, Western Europe and Japan, and in emerging markets like Latin America, the Middle East and South Asia. The iPhone active install base grew to an all time high in total and in every geographic segment. It also set an all time record for upgraders. According to a recent survey from Kantar during the December quarter, iPhone was a top selling model in the US or in China as well as the UK, France, Australia and Japan. The company continues to see high levels of customer satisfaction in the US at 96% as measured by 451 Research."
2:18 pm: "Mac generated $9 billion in revenue, up 16% year over year. We saw strength across our lineup, from the new Mac Mini to the latest MacBook Air and MacBook Pro models. This incredible performance was broad based with double digit growth in every geographic segment. With our latest advances in Apple silicon and our fastest neural engine ever, customers are able to take advantage of the full capabilities of AI and Mac. The Mac install base reached an all time high, and we saw a double digit growth for both upgraders and customers new to the Mac. Additionally, customer satisfaction in the US was recently measured at 94%."
2:18 pm: "iPad revenue was $8.1 billion, up 15% year over year, driven by the new iPad Mini and latest iPad Air, the iPad install base reached another all time high, and over half of the customers who purchased an iPad during the quarter were new to the product. Customer satisfaction was at 96% in the US. Based on the latest reports from 451 Research."
2:19 pm: "Wearables, home and accessories, revenue was $11.7 billion, down 2% year over year. Customers are excited about the new AirPods 4 and the latest hearing health features in AirPods Pro 2 and Watch, although we face a difficult compare against Apple Watch Ultra2 launch last year, the Apple Watch install base reached a new all time high, with over half of customers purchasing an Apple watch during the quarter being new to the product. Customer satisfaction for Watch in the US was reported at 94%."
2:20 pm: "Services revenue reached an all time high of $26.3 billion, up 14% year over year. Services continues to see strong momentum, and the growth of our install base of active devices gives us great opportunities for the future. We also see increased customer engagement with our services offerings, both transacting and paid accounts, reached new all time highs with paid accounts growing double digits year over year, paid subscriptions also grew double digits. We have well over a billion paid subscriptions across the Services."
2:21 pm: Apple has $141 billion in cash and marketable securities after repaying $1 billion in maturing debt, and decreasing commercial paper by $8 billion. $97 billion in total debt, with net cash of $45 billion after returning more than $30 billion to shareholders through $3.9 billion in dividends and $23.3 billion in open market repurchases of 100 million Apple shares.
2:22 pm: FX headwinds expected to continue to be a challenge, an impact on revenue of 2.5% year over year. March quarter revenue is expected to grow low to mid single digits year over year. Services revenue expected to grow low single digits year over year, with a year over year growth rate comparable to the December quarter except for FX challenges. Gross margin between 46.5 and 47.5, with operating expenses between $15.1 and $15.3 billion. Expected tax rate around 16%.
2:22 pm: Dividend of $0.25 per share payable on February 13.
2:24 pm: Q: In your prepared remarks, you noted iPhone 16 models were selling better in markets where Apple Intelligence are available. Can you help us understand that how it's impacting iPhone demand and what features are users using most often already?
A: We did see that the markets where we had rolled out Apple intelligence that the year over year performance on the iPhone 16 family was stronger than those where Apple intelligence was not available. In terms of the features that people are using. They're using all of the ones that I'd referenced in my opening comments, from writing tools to image playground and Genmoji to visual intelligence and and more.
We only had two and a half weeks or so during the December quarter of the second release of 18.2, and then only had the UK and the other English language countries for the two and a half weeks. And so we've got, you know, just the early indications at the moment.
2:27 pm: Q: On China, can you talk about headwinds that Apple faces, is it shifting preferecnes for Western technology in favor of domestic ventors or is it function of not having Apple Intelligence or replacement cycles?
A: If you look at Greater China revenue for the quarter, we were down 11% year over year. Over half of the decline we experienced was driven by a change in channel inventory from the beginning to the end of the quarter. On the Apple Intelligence side we have not rolled out in China, we saw better results we rolled out in than markets we had not. It's also the most competitive market in the world.
In terms of the macro situation, there was a fiscal stimulus or subsidy announced recently in January that did not affect the December quarter. There were some provincial subsidies in December, but the national program was announced in January. It does cover products in categories we have up to a maximum price point, we do see fiscal stimulus occuring and will be glad to talk about what that's looking like on the next call.
2:28 pm: Q: Asking about the DeekSeek situation and the potential for costs to come down as Apple is a big beneficiary of lower cost compute.
A: Innovation that drives efficiency is a good thing in general and that's what you see in that model. Our tight integration of silicon and software will continue to serve us very well. We do things on the device and the private cloud which mimics, from an architectural point of view, what happens on the device. From a CapEx point of view, we've always taken a very prudent and deliberate approach and we continue to leverage a hybrid model.
2:29 pm: Q: With regard to the iPhone trajectory, you don't talk about new products but do you feel like there's a lot of room for form factor innovation in the future or is the current lineup showing where you're going? I'm wondering if you think, in terms of phone innovation, is there a lot more to come? Do you see the current market changing over the next few years?
A: I think there's a lot more to come and I could not feel more optimistic about our current product pipeline. There's a lot of innovation left on the smartphone.
2:31 pm: Q: Was encouraging to hear about the record for iPhone upgraders. What do you attribute this to? Was Apple Intelligence playing a role in the markets you've launched in?
A: We've never seen a higher level of upgraders before. The install base hit a new all-time high as well and if you look at the 16 compared to the 15, from launch which occurred in September, so across two quarters, the 16 outperformed the 15. I think you can conclude from that there are compelling reasons to upgrade and in the markets where we've launched Apple Intelligence, they outperformed markets where we did not. Lots of good color there.
2:32 pm: Q: On the iPad Pro M4, can you talk about that thin form factor for the iPad Pro? How did it help iPad sales overall and what did your marketing and consumer research tell you about how consumers valued that thin product form factor?
A: It's a good question. iPad overall grew 15% for the quarter and it was more driven by iPad Air and the entry-level iPad than the top-level iPad. Overall, we could not be more pleased with the iPad category growing 15%, it's a great achievement for the quarter and probably what is most important is that more than half of the sales in the December quarter went to customers who were new to the iPad. There's still a good amount of customers to attract there.
2:34 pm: Q: Seeing robust growth trends in emerging markets right now, do you think some of these emerging markets are starting to get big enough or growing fast enough to offset some of the China headwinds you're going through?
A: We have great results in a number of emerging markets, I'm particularly keen on India and we're opening more stores there after setting a December quarter record. The iPhone was the top-selling model in India for the quarter and it's the second-largest smartphone market in the world and third-largest for PCs and tablets. It's a huge market and we have very modest share in these markets and I think there's lots of upside there and that's just one of the emerging markets.
Emerging markets we're also seeing double digit growth on the install base in total and for the iPhone.
2:35 pm: Q: On gross margins for March, you're guiding flat. Usually you go up, is it all FX?
A: We're guiding to 46.5-47.5, we're pleased with that level. There's always puts and takes, there will be FX headwinds that will affect revenue and margin, but it's offset by favorable costs and mix of services. Also, moving from Q1 to Q2, we do have a loss of leverage. We feel good about the range and it's a strong guide for gross margin.
2:37 pm: Q: You mentioned channel inventory in China. Do you feel like they're elevated or out of range in any other regions? Is this a normal progression into the March quarter?
A: On a worldwide basis we're very comfortable with channel inventory position, in China, our channel inventory reduced from the beginning to the end of the quarter, and that was more than half of the reduction in reported results. Part of the reason is that our sales were a bit higher than we forecasted them to be towards the end of the quarter, so we ended a little leaner than we expected to.
2:38 pm: Q: Servies growth has been strong but you've been navigating some pretty challenging regulatory burdens. Do you think there's a top line or margin headwind that your'e currently absorbing that could potentially reverse in a more balanced regulatory environment?
A: We set an all-time record for Services, up 14%, and we have a broad services portfolio and we have great momentum across the board. We have a billion paid subscriptions across the Services platform.
2:40 pm: Q: You had a great quarter on Macs and iPads both. And I'm just curious in terms of if you can help us think about the sustainability of this double digit growth that you saw in both the product lines?
A: Mac was up 16% and iPad up 15%, strong uptake on new products during the quarter. Launched M4-based MacBook Pro, iMac and Mac Mini during the quarter. Apple Silicon is designed for these workloads, but I don't want to project at the category level for the future, but we're incredibly pleased with both the Mac and the iPad for the quarter.
2:41 pm: Q: Re India being a strong and emerging market, to ask about supply chain planning there, how much is a growth expectation to that market vs diversification of the supply chain in that country?
A: If you look at the manufacturing we do there, we do manufacturing both for the domestic market and we export, so our business needs certain economies of scale to have it make sense to manufacture in country so it means we're going to need both a use for domestic market and export market.
2:45 pm: Q: How do we square iPhone momentum with the gross margin profile and Apple Intelligence as a momentum driver for iPhone? Where do you think Services margin could go from here being at 75%?
A: Markets where we rolled out Apple Intelligence performed better on a year-over-year basis than markets where we hadn't. That gives us a positive indicator that we were pleased with. The other thing I would say, if you look at it from a launch to the end of the Dec. quarter, that goes back to Sept., the 16 family is outperforming the 15 family. I think those are two good data points. Our next round of language rollouts will be in April, and so it will be in our Q3 quarter.
Re gross margin, Services margin is accretive to overall company margins, but we have a large services portfolio and they have wide gross margins. Payment services and iCloud are growing and when we add incremental users they are accretive to margins. What we expect on a company level is 46.5 to 47.5 and we think that's a strong guide.
2:46 pm: Q: How much of the Mac growth is normal replacement cycle versus Apple Silicon innovation?
A: I think it's a combination of these products being so compelling that it's driving both upgrades at the double-digit level and driving switchers at a double-digit level. We're seeing both come out and I think it's just because of compelling products.
2:48 pm: Q: On product gross margin, how much room do you have to improve or with AI related devices is there more room to grow or not?
A: We had pretty strong sequential improvement, 300 basis points driven by favorable mix and leverage in Q1, it's a launch quarter for many products and we get leverage from higher volume. Our gross margin for products is driven by many factors, many products have different marging profiles and mix makes a difference. Many of our mix across phone, we see people gravitating towards our Pro products. Customers get into our best products and they have favorable gross margin. That trend impacted us and we're in a favorable commodity environment from a cost standpoint and benefited in the December quarter.
We'll have a FX headwind heading into the March quarter and that's included in the guidance we gave.
2:50 pm: Q: What might accelerate the pace of Apple Intelligence adoption and is this time to launch more markets and languages or installed base, or is it about shifting marketing spend or R&D towards AI? Will there be a tipping point where adoption goes mainstream?
A: I think it will go mainstream. I'm getting feedback from people using different features today and this is, keep in mind that on the iPhone side of our business, you either have to have an iPhone 15 Pro or any iPhone 16 to use Apple Intelligence. As that base grows, usage will continue to grow. Once you start using the features, you can't imagin not using them anymore. I get 100s of emails a day and the summarization function is so important.
I think it's a combination of that and in April we roll out a whole series of new languages that you had mentioned and the base grows further.
2:51 pm: Q: Kevan, one of Luca's legacies was getting Apple to record margin levels and maintaining consistent pricing across the product range. What observations can you share about price sensitivity of users and if having a wider range of pricing might unlock potentially further market share or boost overall product growth?
A: I don't think we're gonna really depart from what served us pretty well until now. We always take into consideration looking at comparisons between short term and long term, I think we've had a pretty disciplined pricing strategy which was served us pretty well. And I think we're going to kind of stick with that.
2:51 pm: Q: How do you you see any potential tariff impact under Trump 2.0 after you did fine under Trump 1.0?
A: We are monitoring the situation and don't have any more than that.
2:52 pm: Q: There's a lot of discussion on agentic AI, the use of agents. Upgraded Siri is coming in April, what do you think of that?
A: I think the killer feature is different for different people and I think for most, they'll find they're going to use many of the features every day. One of those is Siri and that will be coming over the next several months.
2:53 pm: Q: Thinking about the average useful life of these devices in the wild, the strong results you saw in 2021, how might that support opportunity in the future?
A: It depends on different types of users. Some early adopters are quick to jump on the latest technology and upgrade very frequently and then you have people on the opposite side of that barbell. Most people are between those two points. I do think there were lots of units sold during the Covid period of time and it's a huge opportunity for us as a company for more than one of the product categories.
2:55 pm: The last analyst just asked one question, and the call ends some five minutes earlier than usual. And the call is wrapped.
