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Apple Q2 2025 · Earnings

Apple Inc. (AAPL) reported a solid performance in its fiscal Q2 2025, delivering broad-based growth and demonstrating resilience across its product and services portfolio. Revenue rose 5% year-over-year to $95.4 billion, while net income climbed to $24.8 billion, reflecting healthy operational efficiency. A standout metric was the diluted earnings per share (EPS), which reached $1.65, marking an 8% YoY increase and a March quarter record. This was underpinned by a gross margin of $44.9 billion and operating income of $29.6 billion, both up from the previous year. Operating cash flow remained strong at $24 billion, reinforcing Apple’s robust cash generation capabilities.

Performance across product segments was largely positive. The iPhone remained the primary revenue driver, bringing in $46.8 billion, up 2%, with growth fueled by strong demand for Pro models. The iPad segment delivered the highest growth at 15%, reaching $6.4 billion, driven by sales of the iPad Air. The Mac line saw a 7% increase, generating $7.9 billion, while Wearables, Home & Accessories declined 5% to $7.5 billion due to weaker wearables demand. The Services segment was a clear highlight, reaching a new record of $26.6 billion, up 12%, thanks to strong performance in advertising, the App Store, and cloud services.

Regionally, Japan led growth with a 17% increase, followed by Americas and Rest of Asia Pacific, both up 8%, bolstered by strength in iPhone and Services. Europe remained flat with a modest 1% rise, while Greater China saw a 2% decline, reflecting softer iPhone sales and currency pressures.

Operating expenses grew in line with strategic investments, with R&D expenses rising to $8.6 billion and SG&A to $6.7 billion, bringing total operating expenses to $15.3 billion, or 16% of sales. Apple also continued to return capital to shareholders, repurchasing $25 billion in stock and paying $3.8 billion in dividends. The company increased its quarterly dividend to $0.26 per share and authorized a new $100 billion share repurchase program, underscoring its confidence in long-term value creation.

Apple also acknowledged emerging risks tied to global trade dynamics. In its latest filing, the company noted that new U.S. tariffs, along with reciprocal measures from countries including China, India, and the EU, could pressure its cost structure, supply chain, and gross margins in future periods. While Q2 gross margin performance remained stable, Apple cautioned that further trade restrictions or material cost increases could introduce volatility and downward pressure in the quarters ahead. Given its reliance on manufacturing in Asia, the company may need to adjust sourcing, operations, or pricing if trade tensions escalate.

CEO Tim Cook attributed the strong results to momentum in Services and the successful launches of the iPhone 16e and new Apple silicon-powered devices, while also spotlighting Apple’s environmental progress, including a 60% reduction in carbon emissions over the past decade. CFO Kevan Parekh emphasized the record-high active installed base across all categories and regions, as well as the company’s strong cash flow and disciplined capital management.

Despite isolated headwinds in Greater China, wearables, and ongoing trade uncertainty, Apple’s Q2 2025 results reflected a business firing on multiple cylinders—driven by innovation, customer loyalty, and financial strength.

May 2, 2025
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