Apple shares rose nearly 2% in premarket trading on Friday after the company forecast record sales for the key holiday quarter, driven by robust demand for its new iPhone 17 lineup despite supply constraints and sluggish performance in China.
CEO Tim Cook told investors that iPhone and total revenue in the December quarter are expected to surpass Wall Street’s projections, supported by sustained global orders for the latest models.
“We are incredibly excited about the strength we’re seeing across our products and services, and we expect the December quarter’s revenue to be the best ever for the company and the best ever for iPhone,” Cook said.
The company has been struggling to meet demand for the iPhone 17 due to production bottlenecks, particularly in China, where assembly slowdowns have delayed shipments.
Despite these issues, Apple’s market capitalization briefly crossed $4 trillion earlier this week, joining Nvidia and Microsoft in the exclusive trillion-dollar club.
Solid quarterly results boost investor sentiment
For the September quarter, Apple reported revenue of $102.5 billion, an 8% increase year-on-year and slightly ahead of analysts’ expectations of $102.2 billion.
iPhone sales rose to $49 billion—just below consensus estimates but signaling a rebound after several slower cycles.
China remained a soft spot, with sales declining from a year earlier as local competitors like Huawei continued to erode Apple’s market share.
However, strong performance in the US and Europe, alongside expanding services and wearables revenue, helped offset the weakness.
iPhone 17 sales momentum and services strength keep analysts bullish despite AI caution
Apple’s stock trades at 33.4 times analysts’ profit expectations, according to LSEG data—a premium to Microsoft’s 31.7 and Meta’s 22.3.
Despite concerns about Apple’s relatively cautious approach to artificial intelligence integration, analysts remain upbeat about its long-term growth trajectory.
Wedbush Securities, which rates the stock “outperform” with a $320 price target, said the iPhone 17 launch is “off to a great start” and predicted a strong holiday quarter.
“The elephant in the room remains the invisible AI strategy-with the biggest consumer installed base in the world of 2.4 billion iOS devices and 1.5 billion iPhones, the time is now for Apple to accelerate its AI efforts through Google in our view,” it said.
TD Cowen maintained a “buy” rating with a $325 target, and said that while higher R&D for AI is necessary for competitiveness, a stronger FY26 growth view “limits any negative operating leverage”.
DA Davidson, with a “neutral” stance and $270 target, said iPhone 17 demand is setting up a “positive FY26.”
Ethan Feller, stock strategist at Zacks Investment Research, said that despite pockets of weakness in iPhone and China sales, the firm’s expanding services segment and improving margins highlight the resilience of its business model heading into 2026.
“While the market remains fixated on AI adoption and monetization, Apple proves that the old recipe still works – at least for another quarter – with solid sales growth in its legacy products and services, supported by a better-than-feared global economy, driving solid revenue expansion,” said Thomas Monteiro, a senior analyst at Investing.com.
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