Apple delivered a robust Q3 earnings beat, fueled by record Services revenue and a massive capital return program, reinforcing the bull case for the stock despite rising memory costs.
Apple's Q3 FY26 performance demonstrates a powerful dual-engine model, with record-breaking Services revenue of $30.74B and a 16.36% YoY revenue increase to $109.42B. The company's aggressive capital return program, including a $100B buyback, continues to shrink the float and compound EPS, supporting a bullish re-rating toward $400 despite valuation concerns. While the quarter benefited from a one-time tariff refund, the underlying strength of the 2.5 billion active device installed base remains the primary driver for long-term growth.
The one-time tariff refund added 11 cents to the quarterly EPS.
Apple's paid subscriptions have surpassed 1.5 billion.
The dividend yield is currently 0.33%.
Apple reported a strong third quarter with revenue reaching $109.42 billion, marking a 16.36% year-over-year increase. The company's Services segment continues to drive profitability with a 75.6% gross margin, while an aggressive $100 billion buyback program supports a bullish outlook toward a $400 share price.
Apple's growth is driven by a dual-engine model consisting of strong hardware sales and a high-margin Services annuity, complemented by significant share repurchases.