Apple's Q3 Earnings: Strong iPhone 17 Shipment to Aid Top-Line Growth

Apple’s AAPL third-quarter fiscal 2026 results, to be reported on July 30, are expected to have benefited from sustained demand for the iPhone 17 family and the more affordable iPhone 17e. The lineup delivered 22% year-over-year growth in the second quarter of fiscal 2026, supported by higher sales of Pro models, record upgrader activity and market-share gains. Demand remained strong across the United States, Greater China, Europe, India, Japan and Southeast Asia.

Apple Intelligence integration, advanced cameras, improved battery life and A19-series processors are likely to have encouraged upgrades. New accessibility capabilities, including AI-powered VoiceOver, Magnifier and natural-language Voice Control, further enhance the utility of the iPhone. However, growth could moderate sequentially following the exceptionally strong fiscal second quarter performance.

The iPhone accounted for 51.3% of net sales in the second quarter of fiscal 2026. The Zacks Consensus Estimate for fiscal third-quarter iPhone sales is pegged at $53.967 billion, suggesting roughly 21.1% year-over-year growth.

Click here to learn how Apple’s overall fiscal third-quarter earnings results are likely to be.

AAPL’s MacBook Demand Expected to Remain Robust

Mac revenues are expected to have benefited from strong demand for the MacBook Neo, M5-powered MacBook Air and MacBook Pro models featuring M5 Pro and M5 Max processors. Mac sales increased 6% year over year in the second quarter of fiscal 2026, driven primarily by higher laptop sales, while the installed base and the number of customers new to Mac reached records.

Apple Silicon’s ability to run advanced AI models locally is strengthening Mac adoption among developers, enterprises and educational institutions. MacBook Neo’s lower price is also expanding Apple’s addressable market. Nevertheless, Mac performance is likely to have been constrained by limited availability of advanced semiconductor nodes. Apple indicated that several Mac models would remain supply constrained during the third quarter of fiscal 2026 because demand exceeded expectations.

The PC segment climbed up 4.9% in the second quarter of calendar 2026, according to IDC. Apple had a market share of 9.9%, up 140 basis points (bps) on a year-over-year basis. Shipments grew 10.1% year over year to 6.7 million. In terms of shipments, Apple outperformed Dell Technologies DELL, Lenovo LNVGY and HP HPQ. Shipments of Dell, Lenovo and HP declined 2.1%, 5%, and 9%, respectively, per IDC data. Dell, Lenovo and HP have market shares of 13.6%, 24.4% and 19.1%, respectively.

The Zacks Consensus Estimate for fiscal third-quarter Mac sales is pegged at $8.674 billion, suggesting 7.8% year-over-year growth.

AAPL iPad Revenues Likely to Face a Difficult Comparison

iPad revenues are expected to have benefited from demand for the M4-powered iPad Air, the A16-powered entry-level iPad and the M5-powered iPad Pro. In the fiscal second quarter, iPad sales increased 8% year over year, while more than half of buyers were new to the product. Strong adoption in emerging markets, including India, Mexico and Thailand, is likely to have supported the segment.

Enhanced Apple Intelligence and accessibility features, including natural-language Voice Control, Accessibility Reader and privately generated video subtitles, should improve iPad’s appeal for education, productivity and creative workloads. However, Apple warned that the segment faced a difficult year-over-year comparison because the A16-powered iPad was introduced in the prior-year quarter. Consequently, iPad revenues may have declined or posted only modest growth.

The Zacks Consensus Estimate for fiscal third-quarter iPad sales is pegged at $8.674 billion, suggesting 5.1% year-over-year growth.

Apple's Wearables Expected to Register Modest Growth

Wearables, Home and Accessories revenues are expected to have benefited from demand for Apple Watch Ultra 3, Apple Watch Series 11, Apple Watch SE, AirPods Pro 3 and AirPods Max 2. The category grew 5% year over year in the second quarter of fiscal 2026, driven by higher wearables and accessories sales. The wearables installed base reached a record, with more than half of Apple Watch buyers being new to the product.

Apple Watch’s health and fitness capabilities and AirPods’ intelligent features, including Live Translation, are likely to have supported demand. The wider integration of Apple Intelligence and accessibility functions across Apple devices may also strengthen ecosystem engagement. 

The Zacks Consensus Estimate for fiscal third-quarter Wearables, Home and Accessories sales is pegged at $7.805 billion, suggesting 5.4% year-over-year growth.

Zacks Rank

Apple currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Zacks' Research Chief Names "Stock Most Likely to Double"

Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.

This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research