Apple posts record $114.5 billion quarter, but a tariff refund padded the margin and iPad fell 10%

Apple reported fiscal fourth-quarter results after the close on Monday, the first under CEO John Ternus, who took over from Tim Cook on September 1. Revenue was $114.5 billion, up 12% from a year earlier, and diluted earnings per share were $2.10, up 14%. According to CNBC's live coverage, analysts polled by LSEG expected revenue of $113.39 billion.

The part the headline skips: tariff refunds

Apple's press release says gross margin was 47.9%, "including a favorable impact of approximately 1 percentage point from tariff refunds," and that the refunds added $0.05 to EPS. Strip that out and EPS was about $2.05 and gross margin about 46.9%. CNBC listed an LSEG consensus of $1.99, so the underlying beat on earnings is real but narrower, about 6 cents rather than 11. Refunds are a one-time item, not a run rate.

By product, from CNBC's tally against LSEG estimates

CNBC reports Mac revenue rose nearly 24%, iPad fell over 10% and Greater China sales rose 21% to $17.53 billion. It also reports that Services grew less than 10%, the slowest pace since 2022, even though Apple calls it an all-time high. Apple's capital spending was $2.24 billion in the quarter, against $3.33 billion expected, a fraction of what the largest AI spenders report.

What is not in the quarter

The quarter ended September 26. CNBC notes it contains only eight days of iPhone 18 Pro sales, and the iPhone Duo reached stores after the period ended. Apple raised iPhone prices by $100 in June and told CNBC through Ternus that it did so "reluctantly" because of memory and component costs. Apple said memory costs were higher than in the June quarter, so the December-quarter gross margin guidance expected on the call will say more than the refund does.

Who this touches

For small businesses that buy Apple hardware, whether point-of-sale iPads, Macs for design work or iPhones for field crews, the price increase is already in the quote, and Apple said its memory costs rose again from the June quarter. The iPad decline is the product line most tied to that kind of business and education buying.

The stock

Nasdaq.com shows Apple closing Monday at $338.32, down 1.83%, and at $338.51 in after-hours trading at 4:51 PM ET, up 0.06%. The call with Ternus and CFO Kevan Parekh was set to begin at 5 p.m. ET, with guidance for the current quarter expected there. We will update when we have read it. For background see our Apple stock explainer.

Sources: Apple Newsroom; CNBC (LSEG estimates); Nasdaq.com quotes; Apple filings on SEC EDGAR. Figures labeled as excluding the refund are our arithmetic from Apple's stated amounts. Some data may be delayed. This is market information, not investment advice.