Apple reported its strongest-ever first quarter for the iPhone, with revenue exceeding $85.3 billion for Q1 2026, according to the company’s earnings announcement. Total revenue reached $143.8 billion, marking a 16% increase compared to the same period last year.
CEO Tim Cook stated during an investor call that the demand for the iPhone was “simply staggering,” leading to a 23% year-over-year revenue growth for the device segment. This surge occurred despite reported setbacks in the rollout of significant artificial intelligence features planned for the operating system.
Features previously reserved for premium models, such as an always-on display and a high-refresh-rate screen, were integrated into the base iPhone 17 model, contributing to its broad appeal. Cook also noted that constraints in the supply chain, specifically concerning the advanced process nodes used for the device’s primary chipset, have resulted in constrained supply against high demand.
While iPhone and Services revenue—which grew 14% year-over-year—showed robust expansion, revenue for the Mac and wearable product categories experienced a decline. The Services division continues to provide a stable, growing foundation for the company’s overall financial performance.
Apple is preparing to deploy its much-anticipated AI personalization features for Siri in the coming months, utilizing a custom implementation of Google’s Gemini model through a partnership. This indicates continued reliance on external foundational models for critical software upgrades.
Further solidifying its AI expansion efforts, Apple reportedly acquired the startup Q.ai for $2 billion, as reported by the Financial Times. Q.ai's patent documentation suggests its technology involves using 'facial skin micro movements' for silent communication, potentially targeting integration within future AR/VR hardware.
Broader speculation, including reports from Bloomberg’s Mark Gurman, suggests Apple intends to transform Siri into a fully integrated AI chatbot across both iPhone and Mac platforms. The company is also developing an AI-powered web search tool to augment Siri’s current capabilities.
These hardware sales figures establish a strong financial footing for Apple as it navigates the complex integration of generative AI into its core product ecosystem. The company’s immediate focus will likely shift to successfully deploying these promised software enhancements to maintain consumer momentum.
