Apple (AAPL) stock was trading 3.4% higher in premarket on Friday, following a quarterly profit and sales report that came in ahead of estimates.
Net income was up 7% and sales were 4% higher from the same quarter a year ago. Meanwhile services revenue was up 14%, with revenue from China down 11%.
“Overall another very strong quarter,” said Neil Wilson, analyst at Tipranks. “It was the first quarterly numbers since the rollout of Apple Intelligence, the company’s suite of AI features. Apple expects growth in the March quarter of “low to mid-single digits” and “low double digits” growth for its Services division.”
For the year-to-date Apple stock is 2.6% lower, knocked amid a wider tech rout related to worries around Chinese AI challenger DeepSeek.
“The roll-out of AI services on iPhone 16 hasn’t exactly gone smoothly. Having been late to the AI party in the first place, Apple still hasn’t rolled out AI services in any non-English language,” said Dan Coatsworth, investment analyst at AJ Bell.
“This cautious pace seems odd when you consider AI has exploded onto the scene and consumers increasingly have a lot of choice for AI-enabled devices. It’s like a carrot dangled in front of Apple and it only wants to nibble at it, rather than devour the whole thing.”
“Consumers need a reason to upgrade their phone, otherwise they’re going to stick with their current model given how even the cheapest devices are fairly sophisticated these days. Apple is clearly hoping its AI services will be the catalyst to drive handset upgrades, but it’s going about it in a strange way.”
