Tim Cook's last report card as Apple CEO: A $109.4 billion June quarter, and a '100-year flood' he's passing to John Ternus
Tim Cook closed out 15 years of Apple earnings calls on Thursday the way he ran most of them: heavy on numbers, light on drama, and a thank-you note right before the analysts got their turn. Apple posted its strongest June quarter ever, with revenue of $109.4 billion, up 16% year on year, and diluted earnings per share of $2.02, up 29%.
Net income came in at $29.8 billion.Then the stock dropped as much as 8% in after-hours trading. The distance between those two facts is the actual story of Apple's Q3 2026—and it's the inheritance John Ternus picks up when he takes over on September 1.iPhone crossed $54 billion and the Mac grew 29%, but one product line went backwardsiPhone revenue hit $54.25 billion, up 22% and roughly half of everything Apple sold.
Mac was the bigger surprise at $10.35 billion, up 29%, powered by the MacBook Neo—the affordable, colourful laptop that launched in March and outsold the MacBook Air fast enough that Apple doubled its production target. About half of large MacBook Neo orders from US schools last quarter replaced Windows machines and Chromebooks.Services came in at $30.74 billion, up 12%, but landed below the roughly $31.2 billion analysts wanted.
Wearables, Home and Accessories added $7.88 billion. iPad was the only category to shrink, down 6% to $6.19 billion. Gross margin of 50.1% included about two percentage points of help from tariff refunds, and $0.11 of the EPS figure came from the same place.Apple's September guidance is what actually spooked investorsApple told analysts to expect 9% to 11% revenue growth next quarter.
The Street had penciled in around 12%. Cook and CFO Kevan Parekh split the blame between a 2.5 percentage point currency headwind and supply constraints that will hit iPhone, Mac and iPad together.Cook was unusually blunt about the cause. It isn't a supplier failing, he said—it's a demand forecast issue, with both iPhone and Mac selling well past what Apple planned for.
Advanced chip nodes are the pinch point, and the company has already pulled forward as much supply as it can.Cook answers why Mac and iPad got more expensive in June, and why iPhone may follow this fallMemory is the other pressure. Apple has paid more for it every quarter since December, and expects to pay more again in September.
It raised Mac and iPad prices in June, pushing the MacBook Neo from $599 to $699 days before the quarter closed.Cook called the situation a "100-year flood on the memory pricing" and said the price rises were made reluctantly. Asked whether adding memory suppliers would help, he noted the DRAM market has three of them, said more would help availability, then corrected himself on pricing—helpful on supply, unclear on cost.
Apple is lobbying Washington for permission to buy from Chinese vendors CXMT and YMTC. iPhone prices have held so far. Few expect that to survive the iPhone 18.India delivered another record revenue quarter for AppleCook lists India among the markets that set June quarter revenue records, alongside the US, China mainland, Western Europe, Japan, Latin America and Southeast Asia.
Parekh went further on Mac, flagging strong double-digit growth in India, Latin America and Southeast Asia, and noting that Mac had its best quarter ever for upgraders and first-time buyers in the US, China mainland and India. India sits inside Apple's Rest of Asia Pacific segment, which brought in $8.87 billion, up 15.6%.That happened while the market around it shrank.
Counterpoint Research data shows India's smartphone shipments fell 10% year-on-year in the June quarter, the worst June performance in six years, with Apple's own shipments down 3% at a 7% share on supply shortages.Revenue tells a different story. "Apple delivered another record revenue quarter in India, with Mac the standout performer," said Tarun Pathak, Research Director at Counterpoint.
He credits MacBook Neo adoption alongside steady iPhone 17 demand, and points out that Apple has kept Indian pricing largely stable while rivals raised theirs repeatedly. Counterpoint expects single-digit volume growth but double-digit value growth in India through CY2026, and rates an iPhone price hike as highly likely.Cook signed off by thanking shareholders and analysts, called Ternus one of a kind, and said he had never been more optimistic.
Ternus, given one question on his first call, offered eleven words about opportunity in AI and left it there. His first report card arrives in November, with the new iPhones on the shelves, memory costs still climbing, and none of Cook's fifteen-year credit line to draw on.Get the latest technology news and updates.
Download the TOI App.