Apple expects slower growth despite strong iPhone sales, blames supply chain constraints
Follow UsApple has announced its financial results for the third quarter of fiscal 2026, reporting its strongest June quarter ever.
Apple also projected slower-than-expected growth for the September quarter.
The company expects September-quarter revenue to grow between 9 per cent and 11 per cent.
Apple has announced its financial results for the third quarter of fiscal 2026, reporting its strongest June quarter ever. The company reported revenue of $109.4 billion for the quarter ended June 27, up 16 per cent from the same period last year. Diluted earnings per share increased 29 per cent to $2.02, while the gross margin reached 50.1 per cent. Apple said the results were helped by strong growth in iPhone, Mac and Services sales across all regions. The company also benefited from tariff refunds.
SurveyApple also projected slower-than-expected growth for the September quarter. The company expects September-quarter revenue to grow between 9 per cent and 11 per cent, below Wall Street’s forecast of around 12 per cent.
Apple CFO Kevan Parekh said during the earnings call, “We expect the impact from supply constraints to increase significantly sequentially. The projected supply constraints in the September quarter affect iPhone, Mac, and iPad. As a result, we expect our September quarter total company revenue to grow between 9%-11% year-over-year. On iPhone, we expect to continue to see high levels of demand.”
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Parekh also revealed that the iPhone revenue was $54.3 billion, up 22 per cent year-over-year, driven by the iPhone 17 lineup.
Despite the strong overall performance, Apple’s Services business did not meet Wall Street expectations. The company reported $30.74 billion in Services revenue, below the estimate of $31.22 billion.
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Explaining the Services results, Parekh said several factors affected the business. One of the biggest reasons was the slowdown in mobile gaming. Apple also pointed to changes in the App Store business model in some countries, including the US.
The company did not just blame App Store problems for the Services revenue miss. Foreign exchange was also cited as the reason.
Even with these challenges, Apple said the App Store recorded its highest-ever June quarter revenue.
“Apple’s board of directors has declared a cash dividend of $0.27 per share of the Company’s common stock. The dividend is payable on August 13, 2026, to shareholders of record as of the close of business on August 10, 2026,” the tech giant said.
