Apple Inc. (AAPL) FY2026 Annual Report Earnings Explained
Revenue and profit both grew, with both products and services giving the numbers a lift
Apple reported revenue of $478.83 billion for fiscal 2026, net income of $132.18 billion, and diluted EPS of $8.98 per share, all stronger than in the prior fiscal year. Both product sales and services revenue were above last year, and they were the direct drivers of the increase. Gross profit came in at $233.6 billion and operating profit at $158.06 billion, showing that higher revenue was not fully eaten up by costs. One thing to watch: the MD&A repeatedly warns that tariffs, the supply chain, AI investment, regulation, and competition could all affect future margins.
📊 Stock Price & Market Cap
- On the filing date, Apple stock was $331.90, close to its 52-week high of $348.91 and well above its 52-week low of $246.63, so the market was already pricing it at a fairly rich level.
- Based on the filing-date data, Apple’s market cap was about $4.82 trillion, still putting it firmly in mega-cap territory. For a company this large, keeping growth going is no small feat.
- The trailing P/E was 37x, based on trailing diluted EPS of $8.98. That suggests the market is already expecting a lot, and the company will need to keep delivering.
Data as of 2026-11-03 (filing date) · Price: Yahoo Finance · Shares & EPS: SEC filing · Forward P/E: not available · Yahoo Finance
🏦 What Wall Street Thinks
Analysts are broadly at a Buy: among 43 firms, 18 rate it Strong Buy, 6 Buy, 13 Hold, 3 Sell, and 3 Strong Sell. Target prices range from $250 to $400, with an average target of $338.45, which is quite close to the filing-date share price of $331.90.
Ratings as of: 2026-11-03 · Price targets as of: 2026-11-04 · Source: stockanalysis.com
Analyst forecasts are for reference only. Historically, price targets have not been very accurate. Invest at your own risk.
💰 How Much They Made
| This year | Year ago | Change | |
|---|---|---|---|
| Revenue | $478.83B | $416.16B | ▲ 15.1% |
| Cost of sales | $245.23B | $220.96B | ▲ 11.0% |
| Gross profit | $233.60B | $195.20B | ▲ 19.7% |
| Operating profit | $158.06B | $133.05B | ▲ 18.8% |
| Net income | $132.18B | $112.01B | ▲ 18.0% |
| Diluted EPS | $8.98 | $7.46 | ▲ 20.4% |
- Revenue rose from $416.16 billion to $478.83 billion, showing that Apple’s overall business volume from products and services got bigger this year.
- Net income increased from $112.01 billion to $132.18 billion, which means not only did revenue grow, but more money actually made it to the bottom line.
- Diluted EPS rose from $7.46 per share to $8.98 per share, meaning each share earned more for common shareholders.
📊 Where the Money Went
| This year | Year ago | Change | |
|---|---|---|---|
| Cost of sales | $245.23B | $220.96B | ▲ 11.0% |
| Research and development | $45.77B | $34.55B | ▲ 32.5% |
| Selling, general and administrative | $29.77B | $27.60B | ▲ 7.9% |
| Total operating expenses | $75.54B | $62.15B | ▲ 21.5% |
- Research and development spending increased from $34.55 billion to $45.77 billion, a clear step up in investment. The MD&A also says Apple continues to invest in AI features, infrastructure, and related talent.
- Selling, general and administrative expenses rose from $27.6 billion to $29.77 billion, but the pace was more modest than the increase in R&D.
- Cost of sales increased from $220.96 billion to $245.23 billion. As revenue expands, the costs tied to making products and delivering services also move up.
🏢 Business Segments
Net product sales were $355.53 billion, above last year’s $307 billion. The filing does not provide operating profit for this segment.
Net services sales were $123.3 billion, above last year’s $109.16 billion. The filing does not provide operating profit for this segment.
🏦 Balance Sheet
| Period end | Prior FY end | Change | |
|---|---|---|---|
| Total assets | $404.55B | $359.24B | ▲ 12.6% |
| Total liabilities | $292.45B | $285.51B | ▲ 2.4% |
| Shareholders’ equity | $112.09B | $73.73B | ▲ 52.0% |
| Cash and cash equivalents | $36.30B | $35.93B | ▲ 1.0% |
| Long-term debt | $68.21B | $78.33B | ▼ 12.9% |
- Total assets increased from $359.24 billion to $404.55 billion, so the balance sheet got bigger.
- Shareholders’ equity increased from $73.73 billion to $112.09 billion, so book net worth rose noticeably.
- Long-term debt fell from $78.33 billion to $68.21 billion, easing debt pressure versus the end of the prior fiscal year.
⚠️ Total assets on the books ($404.55B) are not what the company is worth. The market values Apple Inc. at $4.82T, 11.9× its book assets. The gap comes from things the balance sheet doesn't show: brand, technology, customer relationships and future earning power.
📅 vs. a Year Ago
| This year | Year ago | Change | |
|---|---|---|---|
| Revenue | $478.83B | $416.16B | ▲ 15.1% |
| Gross profit | $233.60B | $195.20B | ▲ 19.7% |
| Operating profit | $158.06B | $133.05B | ▲ 18.8% |
| Net income | $132.18B | $112.01B | ▲ 18.0% |
| Diluted EPS | $8.98 | $7.46 | ▲ 20.4% |
- Year over year, revenue, gross profit, operating profit, net income, and EPS were all higher than last year, so the core income statement metrics improved across the board.
- The filing breaks out that both product and services revenue were higher than last year. That said, the MD&A does not further split out which specific devices, regions, or service lines drove the growth.
- The MD&A warns that future revenue and gross margin could be affected by component supply, memory and storage costs, foreign exchange, tariffs, competition, product mix, and AI spending. These are the variables to watch going forward.
🎯 Key Takeaways for Investors
Apple’s improvement this year was not just about one flattering metric. Revenue, gross profit, operating profit, net income, and diluted EPS were all higher than last year, and both products and services were growing.
R&D rose to $45.77 billion, clearly above last year’s $34.55 billion. Taken together with the MD&A, AI features, computing power, storage, and infrastructure spending will be key to future costs and competitiveness.
The MD&A highlights tariffs, geopolitics, supply-chain concentration, critical component availability, foreign exchange, and regulatory pressure, all of which could affect Apple’s revenue, costs, gross margin, and share price.
The trailing P/E on the filing date was 37x, with a market cap of about $4.82 trillion. At this valuation, investors will care even more about whether Apple can keep growing and protect margins.
This 10-K does not give specific revenue or profit targets for the next fiscal year. Retail investors may want to watch for AI product rollout, services resilience, supply-chain costs, and regulatory changes.
📄 Original Filing
- Original 10-K on SEC EDGAR (2026-11-03, accession 0000320193-26-000026)
- SEC filing index (incl. financial statements)
This page was generated by AI from the company's SEC filing and translated by AI. Not investment advice.