Beyond the Numbers: What Tim Cook Revealed About Apple’s Record Q1
Toggle Dark Mode
Apple reported its fiscal Q1 2026 earnings yesterday, heralding record-breaking revenue $143.8 billion, up 16% year-over-year. Following the release of the quarter’s numbers, Apple CEO Tim Cook and CFO Kevan Parekh discussed the quarter with journalists and analysts on a conference call and also made additional comments to various publications. Here’s a recap of some of the most interesting insights from those discussions.
AirPods Pro 3 Popularity Caught Apple Off-Guard
Cook told Reuters that while Apple’s Wearable, Home, and Accessories segment saw an approximately 2% drop in revenue year-over-year, the segment might have grown had the company not been caught off-guard by the popularity of its new AirPods Pro 3 wireless earbuds, which debuted in September.
AirPods Pro 3 were supply-constrained during the quarter, and we think we would have grown year over year if we would not have been constrained.
Tim Cook
The comments from Apple’s CEO suggest the company didn’t realize the new earbuds would be such a big hit, and didn’t have enough inventory on hand ready to hit stores.
AirPods Pro 3 offer improved sound quality, better active noise cancellation, a longer battery life, heart rate monitoring, increased water resistance, and new ear tip sizes offering improved fit.
As noted by Mactrast, the wireless earbuds supply is apparently now less constrained, as Apple’s online store doesn’t show any shipping delays, and Amazon shows it could deliver a pair to most customers later today.
Rising RAM Prices
During the earnings call, Cook also commented on how fast-rising RAM and SSD storage chip prices impacted Apple in the fiscal first quarter, and how those might affect the company in the future.
Cook told call participants that rising RAM and storage chip prices had a “minimal impact” on the company’s gross margin last quarter, although he does expect a “bit more of an impact” on Apple’s gross margin in the current quarter.
Cook added that Apple “will look at a range of options to deal with that” over the long term, if needed.
Despite rising component prices, Apple continues to post impressive earnings, with revenue up 16% year-over-year. However, while gross margins were as high as 49% for the quarter, giving Apple some elbow room to deal with rising component prices, Cook is also signalling a tighter ship for Q2.
Impressive iPhone 17 Lineup Sales
Apple’s financials were driven at least in part by unprecedented demand for the iPhone.
iPhone revenue in the fiscal first quarter was $85.2 billion, a new all-time high, and a 23% increase from the $69.1 billion in sales for the year-ago quarter.
“iPhone had its best-ever quarter driven by unprecedented demand, with all-time records across every geographic segment,” Cook had announced in Apple’s earnings results press release. Cook also told CNBC’s Steve Kovach that demand for the “iPhone 17 family” during the holiday quarter was “simply staggering,” easily beating Apple’s expectations.
Apple’s current iPhone lineup is made up of the iPhone 17, iPhone Air, iPhone 17 Pro, and iPhone 17 Pro Max. Unfortunately, Apple does not break down iPhone revenue on a model-by-model basis, so we don’t know which models were most popular.
More Than 2.5 Billion Active Apple Devices
In Apple’s earnings press release, it was revealed that Apple has a mind-boggling number of active devices in the world today.
We are also excited to announce that our installed base now has more than 2.5 billion active devices, which is a testament to incredible customer satisfaction for the very best products and services in the world.
Tim Cook
That’s a significant jump from the installed base of 2.35 billion devices reported in the year-ago quarter.
