One last time, this is Tim: Final transcript of Apple’s Q3 2026 earnings call

Tim Cook signals for victory!

For the 90th and final time, Apple CEO Tim Cook hopped on a conference call with financial-industry analysts to detail the quarter gone by, give a peek at what’s to come, and maybe take one final victory lap. CFO Kevan Parekh and incoming CEO John Ternus were there, too.

This is Six Colors’s complete transcript of the call for July 30, 2026.

Tim Cook’s introduction

Thank you, Suhasini. Good afternoon, everyone, and thanks for joining the call. Today, Apple is pleased to report $109.4 billion in revenue, up 16% from a year ago and a June quarter record. We were able to achieve this despite supply constraints and sequential foreign exchange headwinds.

We continue to see enormous customer enthusiasm for our most popular lineup ever, with iPhone revenue growing 22% from a year ago to reach a June quarter record. We saw so much excitement around the best Mac lineup we’ve ever had, growing a strong 29% to achieve a June quarter revenue record. Services also set a June quarter record with $30.7 billion in revenue.

We achieved June quarter revenue records in every geographic segment. We were pleased to see strength across the board with June quarter records in the U.S., Latin America, Western Europe, India, China mainland, Japan, and Southeast Asia. We also achieved June quarter revenue records in both developed and emerging markets and saw double-digit growth in most emerging markets.

This year’s WWDC was a wonderful showcase of our latest innovations. We were tremendously excited to unveil the all-new Siri AI, a completely reimagined version of Siri that is profoundly capable, deeply personal, and integrated seamlessly across our platforms. And we’ve been absolutely thrilled by the response who’ve been using Siri AI in the developer and public betas. The reviews from early users have been phenomenal, and it’s been so wonderful to hear from people who are excited about the capabilities we’ve built. And it underscores our philosophy that building AI that is private and based on personal context can change how users find information and get things done with our products in a way that truly enriches their lives. We really couldn’t be more excited about it, and we are feeling incredibly enthusiastic about the impact it’s going to have.

At WWDC we also announced new tools to help parents keep kids safe online and we were pleased by the overwhelmingly positive reaction. New child safety features like Ask to Browse and Time Allowances will help parents encourage kids to develop healthy digital habits. These new tools integrate guidance from leading clinical and child development research, including the American Academy of Pediatrics. Our goal is to make it easier for parents to manage what their children see, who they interact with, and how and when they can use their devices. We’re looking forward to bringing these new capabilities to users this fall, in addition to amazing new updates across our operating systems.

Now let me turn to the results for the quarter, beginning with iPhone. iPhone revenue for the June quarter was $54.3 billion, up 22% from a year ago. We achieved June quarter records in every geographic segment, and set a June quarter record for upgraders. According to IDC, we gained share globally during the quarter. As I’ve said before, this is the most powerful and most popular iPhone lineup we’ve ever had. More people are relying on iPhone every day for AI, powered by the outstanding performance of A19 and A19 Pro. Across the lineup, iPhone continues to deliver the performance, battery life, durability, and camera capabilities that people count on every day. Whether it’s the extraordinary camera system of iPhone 17 Pro and Pro Max, the remarkably thin design of iPhone Air, the balanced performance and durability of iPhone 17, or the exceptional value of iPhone 17E, there’s an iPhone for every customer.

Mac delivered its best June quarter yet, with $10.4 billion in revenue, growing an impressive 29% from a year ago despite significant supply constraints. This revenue growth was driven by the incredible strength of our latest lineup, with MacBook Pro and the all-new MacBook Neo. According to IDC, we gained share globally. We also set a June quarter revenue record in developed markets and an all-time record in emerging markets with particular strength in Greater China, where we had an all-time revenue record. In addition, we achieved all-time records for upgraders and customers new to Mac.

With the power of Apple Silicon, the Mac lineup delivers outstanding power-efficient performance, massive memory bandwidth, and next-level AI capabilities. Mac continues to be the ultimate AI powerhouse, excelling at high throughput, on-device inference, and creation across a broad range of AI workloads. And we’re seeing customers increasingly put those capabilities to work, from using Mac Mini as a powerful platform for agentic AI to deploying clusters of Mac Studio systems to run frontier-class models locally.

Across the lineup, customers continue to embrace the Mac family. MacBook Neo has been especially popular, with its distinct design and excellent value resonating with customers around the world, and we’re continuing to work hard to meet demand. MacBook Air, the world’s most popular laptop, continues to deliver the portability and performance customers love with M5. And MacBook Pro, powered by M5 Pro and M5 Max, remains a go-to choice for professionals tackling the most demanding AI, development, and creative workflows.

In iPad, revenue was $6.2 billion for the June quarter. iPad continues to be the ultimate go-anywhere, do-anything device for students, entrepreneurs, and creators of all kinds, thanks to its incredible power, portability, and versatility. The addition of M4 to iPad Air has made it even more capable, delivering a significant performance boost for everything from personal productivity and immersive learning to advanced creative workflows. Together with a remarkable performance of iPad Pro, the amazing value and versatility of iPad, and the ultra-portable iPad Mini, we’re offering customers our strongest iPad lineup ever.

Revenue for Wearables, Home, and Accessories was $7.9 billion, up 6% from a year ago. We grew in every geographic segment and achieved a June quarter record for upgraders for Apple Watch. Our Apple Watch lineup brings together the most comprehensive set of health and fitness features we’ve ever had. We’re delivering useful features backed by research to enable users to better understand their health and wellbeing. It’s gratifying to receive almost daily reminders of the meaningful impact Apple’s health innovations are having for users all over the world—changing, even saving lives.

Meanwhile, we continue raising the bar across our AirPods lineup, whether it’s the immersive listening experience of AirPods Pro 3, or the premium listening experience and exceptional active noise cancellation of AirPods Max 2. And with live translation powered by Apple Intelligence, people are crossing language barriers and connecting like never before.

As I mentioned earlier, we’re excited about the work we’re doing on the next generation of Apple Intelligence, including Siri AI and the AI features we’re developing across our platforms. These experiences are intuitive and useful, while also deeply integrated in a way that’s personal and private, with the latest models running on device and on servers using Private Cloud Compute. We began laying the groundwork for users to have the best possible experience with AI when we introduced the Neural Engine in 2017. Ever since then, we’ve innovated and invested deliberately in silicon, systems, and scalable unified memory architecture designed with AI at their core.

What sets Apple apart is the unique combination of massive unified memory bandwidth, industry-leading power-efficient performance, and deep on-device intelligence, all built around the customer experience from the ground up. The result is that Apple has created the world’s best hardware to experience AI, whether using Apple Intelligence, including Siri AI, or third-party offerings. That’s why developers and researchers are increasingly using Apple devices to build ever-more advanced tools and models.

Turning to services, revenue was $30.7 billion, a June quarter revenue record and up 12% from a year ago, despite significant sequential foreign exchange headwinds. We also set an all-time revenue record in developed markets and a June quarter record in emerging markets. Apple TV continues to leave audiences spellbound with new releases like Widow’s Bay and Cape Fear alongside returning favorites like Silo and Sugar. And next week, we’re excited that Ted Lasso is back for its fourth season.

It was wonderful to see Apple TV earn the industry’s top honors, adding Tony Awards this year to its Emmy, Grammy, and Oscar wins. We reached that milestone faster than any streamer in history. We’re also looking forward to this year’s Emmy Awards, where Apple has landed a record 89 nominations, leading all networks in both the major drama and comedy series categories with three outstanding drama series nominations and three outstanding comedy series nominations. Widows Bay also stands out as the year’s most nominated new program, earning 19 Emmy nominations. In the six and a half years since launch, Apple TV has earned more than 850 wins and nearly 3,800 nominations.

In time for the World Cup, we expanded Apple Sports to include more than 170 countries and regions worldwide and made it easier than ever for fans to follow every moment of the tournament from the opening game to the final whistle. At the same time, we’re halfway through an unforgettable year of F1, and Apple TV subscribers have been tuning in all season to follow their favorite drivers and teams.

In retail, we were pleased to announce Apple Upgrade this week for customers in the U.S. Apple Upgrade is a new hardware leasing program launched in partnership with Klarna and makes it even easier for customers to get their hands on Apple’s latest products with a plan that’s right for them.

In all of our work, we’re thoughtful and intentional in how we show up for our users and across our communities. That means innovating to protect user privacy with the next of Apple Intelligence or helping parents keep kids safe, as I mentioned earlier. In honor of Global Accessibility Awareness Day, we unveiled new features to help users get more out of the products they use every day. New intelligent capabilities are coming to VoiceOver, Magnifier, Voice Control, and Accessibility Reader to make them more useful and intuitive. We’re also using on-device speech recognition to generate subtitles for video content without captions. And Apple Vision Pro is adding a feature for power wheelchair users to control drive systems using just their eyes. All of these features were born out of Apple’s longstanding commitment to ensuring that the benefits of technology are shared with everyone.

As we continue to develop new capabilities for users around the world, we’re also doing our part to invest in innovation close to home. Last year, we made a $600 billion commitment to the U.S. over four years, and now, as we said before, we plan to reinvest the tariff refunds we’ve received into the U.S.

We’re pleased with the progress we’ve already made advancing the American supply chain. Earlier this month, Apple announced a new agreement with Broadcom to design and produce custom silicon components and cutting-edge wireless connectivity technologies. The new, multi-year agreement with Broadcom, which is part of Apple’s American Manufacturing Program, is expected to exceed $30 billion. This marks our largest-ever American Manufacturing Program commitment. It’s also an important step forward in our work to build an end-to-end silicon supply chain here in the U.S.

We’re excited for the upcoming opening of the Apple Advanced Manufacturing Center in Houston. The center is located in a facility where we currently assemble advanced AI servers. Later this year, we’ll make Mac mini there, too. The center will teach students, supplier employees, and business of all sizes, the same innovative processes we use to make our products. The goal is to empower American manufacturers to take their work to the next level and strengthen the entire advanced manufacturing ecosystem.

We have an exciting fall ahead and an incredible future beyond. Our road map is phenomenal, and we are so excited about the way Siri AI will enrich our users lives. Throughout all of it, we will remain guided by our North Star: building the best products and services to enable people to do magical things. It’s a special privilege to be part of people’s lives in lasting and meaningful ways, helping them to create, connect, and experience the world around them. I couldn’t be more excited to watch our phenomenal story of innovation continue to unfold, and I’ve never been more confident that the best is yet to come. With that, I’ll turn it over to Kevan.

Kevan Parekh’s opening remarks

Thanks, Tim, and good afternoon, everyone. Here’s a quick rundown of our key financial metrics. Our revenue of $109.4 billion was up 16% year over year, a June quarter revenue record. We saw strong performance around the world with double-digit growth in every geographic segment despite supply constraints. Products revenue was $78.7 billion, up 18% year over year, driven by double-digit growth on iPhone and Mac, both of which set new June quarter records.

Our installed base of over two and a half billion active devices has reached another all-time high across all major product categories and geographic segments. Services revenue was $30.7 billion, up 12% year-over-year. We set revenue records in every Services category, including all-time records in cloud services and payment services. Company gross margin was 50.1%, up 80 basis points sequentially. This included a benefit from tariff refunds, which had a favorable impact of approximately two percentage points. When you remove this favorable impact, we would have been at the midpoint of the guidance provided last quarter.

Products gross margin was 40.1%, up 140 basis points sequentially. This also included a benefit from the tariff refunds I just mentioned, which had a favorable impact of over 2.5 percentage points. Services gross margin was 75.6%, down 110 basis points sequentially, driven by a different mix. Operating expenses came in at $19.1 billion, up 23% year-over-year, driven by investments in R&D. Net income was $29.8 billion. Diluted earnings per share was $2.02, up 29% year-over-year, and included 11 cents of favorable impact from tariff refunds. Operating cash flow was very strong at $34.4 billion. All three of these metrics set June quarter records, even when excluding the tariff refund benefit.

Now I’m going to provide some more details for each of our revenue categories.

iPhone revenue was $54.3 billion, up 22% year-over-year, driven by the iPhone 17 family. We grew double digits in the vast majority of markets we track and reached June quarter revenue records across both developed and emerging markets. The iPhone active installed base grew to an all-time high and set a June quarter record for upgraders. According to a recent survey from Worldpanel, iPhone was a top-selling model in the U.S., urban China, the U.K., France, Australia, and Japan. We were thrilled with the response to the iPhone 17 family. Customer satisfaction in the U.S. was recently measured at 99% by 451 Research.

Mac revenue was $10.4 billion, up 29% year-over-year, a new June quarter record, driven by the strength of MacBook Neo and MacBook Pro. We grew in both developed and emerging markets, with strong double-digit growth in markets like Latin America, India, and Southeast Asia. The customer reception to MacBook Neo has been incredible. We continue to attract new customers to the product around the world. As Tim mentioned, Mac had its best quarter ever for customers new to the Mac and for upgraders worldwide, including in the U.S., China mainland, and India. And in the U.S., customer satisfaction for Mac was recently measured at 95%.

iPad revenue was $6.2 billion, down 6% year-over-year, driven by the continued difficult compare against the launch of the A16 powered iPad in the prior year. At the same time, the iPad installed base reached a new all-time high, and over half of the customers who purchased an iPad were new to the product. And 451 Research recently measured customer satisfaction at 98% in the U.S.

Wearables, Home and Accessories revenue was $7.9 billion, up 6% year-over-year, driven by strength in wearables and accessories, and we saw growth in both developed and emerging markets. The wearables installed base reached a new all-time high. We set a June quarter record for upgraders on Apple Watch, and over half the customers purchasing an Apple Watch during the quarter were new to the product. And in the U.S., customer satisfaction on Apple Watch was reported at 95%.

Our Services revenue reached a June quarter record of $30.7 billion, up 12% year-over-year, despite significant sequential FX headwinds. For the total services business, we saw a double-digit growth in the vast majority of markets we track. We set records in every category, with June quarter records in advertising, App Store, AppleCare, music, and video, as well as all-time records in cloud services and payment services. We are optimistic about the long-term future of our services business. With our large installed base of over two and a half billion active devices, we have an incredibly strong foundation for growth opportunities. Our services continue to attract more customers, and we have now surpassed $1.5 billion in paid subscriptions. Both transacting and paid accounts reached new all-time highs in the quarter, with double-digit growth for both in emerging markets. And we continue to improve and expand our services offerings, from powerful updates to Creator Studio to exciting new features we’re bringing to services later this year, like splitting bills with Apple Cash using Visual Intelligence.

Turning now to enterprise and education, organizations are using the Apple platform to drive AI innovation and empower the next generation of students. Starting with Enterprise, Morgan Stanley has deployed over 20,000 iPhone 17 devices globally as part of a shift from employee-owned to corporate-owned devices for liability and security. More companies are choosing Mac for on-device AI advantages, including lower costs, better performance, and enhanced privacy and security. At Disney, creative teams are increasingly turning to Mac for on-device AI workflows that reduce overall cloud token costs and keep their IP secure. And Credit Agricole, France’s leading retail bank, is using on-device AI and MacBook Pro to streamline regulatory workflows, reducing manual processing time by over 80%. Our newest addition to the Mac lineup, MacBook Neo, is reaching new enterprise users in many environments, from bank branches to retail storefronts.

In education, MacBook Neo continued to accelerate adoption of Apple products, with many districts leveraging Apple financial services to deploy at scale. Pinellas County Schools, one of the largest districts in Florida, is transitioning 25,000 students from Windows devices to MacBook Neo across its 18 high schools. In Washington, Peninsula School District 401 moved over 8,000 students from Chromebooks to MacBook Neo. And in Oklahoma, Midwest City-Dell City School District purchased over 6,000 MacBook Neos to become an all-Apple district for students. In fact, in the last quarter, about half of the MacBook Neo large purchases by U.S. education institutions displaced Windows and Chromebook devices.

Let’s turn to our cash position and capital return program. We ended the quarter with $147 billion in cash and marketable securities and $84 billion in total debt. During the quarter, we returned $33 billion to shareholders. This included $4 billion in dividends and equivalents and $25.8 billion in share repurchases.

As we move ahead into the September quarter, I’d like to review our outlook, which includes the types of forward-looking information that Suhasini referred to. Importantly, the color we’re providing assumes that global tariff rates, policies, and their application remain in effect as of this call, and the global macroeconomic outlook does not worsen from today.

We also expect our September quarter total company revenue to be impacted by two main factors. First, we expect foreign exchange to be a sequential headwind of about 2.5 percentage points to the year-over-year total company growth rate from the June quarter to the September quarter. Second, we expect the impact from supply constraints to increase significantly sequentially. The projected supply constraints in the September quarter affect iPhone, Mac, and iPad. As a result, we expect our September quarter total company revenue to grow between 9% and 11% year-over-year.

On iPhone, we expect to continue to see high levels of demand; however, we do expect iPhone revenue to be impacted by these foreign exchange headwinds and supply constraints. Therefore, we expect the September quarter reported growth rate for iPhone to be mid-teens year-over-year. For Services, we expect September quarter year-over-year reported growth rate to be largely similar to what we reported in the June quarter after removing the negative sequential impact of about two and a half percentage points from foreign exchange that we just described.

We expect gross margin to be between 47 percent and 48 percent. This includes an expected benefit of approximately one percentage point related to tariff refunds. We expect operating expenses to be between $19.1 billion and $19.4 billion. We expect OI&E to be around $350 million, excluding any potential impact from the mark-to-market of minority investments, and our tax rate to be around 16.5 percent.

Finally, today our Board of Directors has declared a cash dividend of $0.27 per share of common stock payable on August 13, 2026, to shareholders of record as of August 10, 2026.

Before we take questions, let me turn it back over to Tim.

A farewell from Tim

Thanks Kevan. Before we get into questions, I just wanted to take a moment to say thank you. Thank you to all of you, from our shareholders, particularly our long-term shareholders who have put their trust in us for so many years, to the analysts who have followed our company so closely. As you know, this will be my final earnings call, and John will lead these calls going forward. The transition is going seamlessly, and I am beyond excited for John to step into his new role and lead Apple into its next era. He is truly one of a kind and there is no better person to take the helm of the company.

As I’ve said, I couldn’t be more confident in his leadership, in our executive team, and in the extraordinary people at Apple who are determined to enrich the lives of our users all over the world. We have a bright future ahead, and I truly have never been more optimistic. So thank you all, and now Kevan and I will be happy to take your questions.

Analyst Q&A

Amit Daryanani, Evercore: Tim, best of luck. It’s been a pleasure working with you over the years. Maybe to start with, if I think about the 9 to 11% sort of growth that’s guided for September, it’s about a 500 basis points or so deceleration versus what we’re seeing really in June quarter, even through this year, I would say. Can you just talk about how much of this decel is really supply constraint versus other factors like FX? And if you could just flesh out what these supply constraints are, broadening beyond these advanced SOCs you talked about last quarter as well.

Kevan Parekh: Amit, this is Kevan. How are you doing? Why don’t I start with just kind of describing the sequential change, and then I’ll let Tim jump in for kind of a bit more color around the supply constraints. So I think as I mentioned in my prepared remarks, we expect the September quarter total revenue to grow by 9% to 11% year-over-year, and then we expect that to be impacted by two main factors. So first, when we look at going from the June quarter to September quarter, we expect foreign exchange to be a sequential headwind of around 2.5 percentage points to the year-over-year company growth rate. And then the second impact is that the impact from supply constraints, we expect that to increase significantly when we go sequentially from June to September, and that projected supply constraint in the September quarter will affect the iPhone, Mac, and the iPad. And really, when you combine those two factors, we get pretty close to the June overall total company growth rate.

Tim Cook: Yeah, Amit, it’s Tim. First of all, thank you for your comments. During the June quarter, we did experience supply constraints primarily on the Mac and to a lesser extent on iPhone and iPad. These were driven by very high levels of demand, and as we’ve said before, we are seeing less flexibility in the supply chain than normal, and were primarily driven by the availability of the advanced nodes that our SOCs are produced on. If you look forward then into the current quarter, the September quarter, we continue to expect high levels of demand. However, with less flexibility in supply chain, we expect the impact from the supply constraints to increase significantly sequentially. The projected supply constraints in the September quarter, as Kevan said, affect iPhone, Mac, and iPad. And so, we’re seeing some very significant constraints currently, with limited flexibility in the supply chain to remedy it.

Amit Daryanani, Evercore: Got it. That’s really helpful. Thanks a lot for that. And then, Tim, I just have a memory question for you. Apple has historically, I think, done a really excellent job about delivering capability and utility to customers without really making them pay disproportionately more. The stagnant memory inflation seems to challenge that equation for you folks right now and there are reports that suggest that you’re seeking greater sourcing flexibility for memory. Can you just talk about, is this sourcing options really about ensuring that you have supply and it’s a way to mitigate memory inflation, or is more to preserve the value proposition for your customers. Just any light you could shed on this would be helpful. Thank you.

Tim Cook: Yeah, let me back up and talk about memory in general, ’cause I know this is a subject on many of your minds. As I’d said on the last call, we paid more for memory in the March quarter than the December quarter. And then, as I alluded to last quarter, we expected to pay significantly more in the June quarter than the March quarter, and that is what happened. It was partially offset by the benefit of carry-in inventory. For September, we expect to pay even higher memory costs. And we’re able to offset partly by a few factors, and let me walk through kind of what they are.

The first is, as you would expect, we have a benefit from some carry-in inventory in the September quarter. However, we believe this will see decreasing benefit from this over time, beyond the September quarter. The second is, we’re expecting lower costs on certain non-memory components that are in our BOM, and then if you look beyond September, we see the market pricing for memory continuing to increase, which could drive an increasing impact on our business, and we’re continuing to evaluate this.

In terms of the sources of supply, you know, primarily the DRAM market has three suppliers, and obviously if there were more suppliers, that would be good, and it would help us on the supply side and perhaps the pricing side. It’s unclear on the pricing side, but it could help on the supply side, and so, we’re evaluating all options.

Michael Ng, Goldman Sachs: Good afternoon. First, Tim, congratulations on the extraordinary run and [inaudible] on these earnings calls. In terms of my questions, I have two as well. First, on the Apple Upgrade program, could you talk a little bit about the expected adoption rates across your 2.5 billion device installed base in success? Do you see it shortening the replacement cycle for iPhone, or also having an equal impact to Mac and iPad, which may have not have benefited from device subsidies in the U.S. like iPhone has historically.

Tim Cook: Michael, first of all, thank you for your comments. I really appreciate that. If you look at the upgrade program, what it’s all about is making it easier for for customers to get their hands on our latest products with a leasing plan that’s right for them. And of course, as you know, the residual values on Apple products are generally much higher than the residual value on several of our competition, and so it’s a way to get into a product on a fairly affordable basis, particularly for those customers who want to upgrade on some kind of schedule, and so we’re very excited about it. It is offered in our retail stores, and so it’s not widely offered in all channels, and so we’ll see what the customer uptake is, but the early feedback on it is quite positive.

Kevan Parekh: Yeah, Michael, I just mentioned that it’s only available in the U.S. right now as well.

Michael Ng, Goldman Sachs: Great. Thank you. That’s very helpful, and then my second question, just on iOS 27 and Apple Intelligence. Went into public beta earlier this month. Could you talk about learnings from the public beta? Will the new Siri AI be a demand driver for iPhones this holiday? How does the Apple Intelligence usage to date in the open beta inform how you’re thinking about compute costs and the ability to recover some of those costs through iCloud Plus.

Tim Cook: Yeah, thank you for that. First of all, we are off the charts excited about Siri AI. We had a great reception from WWDC. We released the developer beta immediately after the keynote. The developer feedback has been overwhelmingly positive. The feedback from reviewers and so forth have been overwhelmingly positive. We released it to the public for a public beta a few weeks ago and the continued feedback is really, really great. I think it’s a very big idea have AI that’s private, that’s based on your personal context, and that’s integrated across the operating system, and so we couldn’t be happier with how things are going. In terms of what it means for compute cost, it’s obviously early going for us, and so I don’t want to say that we have a complete plan for that. We do believe there will be people that want to use it a lot, and so we will have some kind of upgrade possibilities on iCloud Plus where people can buy up the stack on iCloud Plus, and we’ll see how the pickup for that is. But we could not be more excited about where the product is.

Ben Reitzes, Melius Research: Hey, guys. Thanks a lot for the question, and obviously, Tim, known you a long time, I’ll really miss you. I wanted to ask about the supply constraints again, and I think people are just trying to make sense of it a little bit this way, is that the Street had you at 12% growth for the quarter of September, and so you could argue that to get to the 10% you guided, that’s just the FX, and then in the first quarter, which is December, the Street has been decelerating quite a bit, to like 8% to 9%. So I think what we’re struggling with after hours here is how much these supply constraints really hit you in December and impact that because, you know, the Street did a pretty good job of taking that number into the higher single digits. You know, is there any guidance you can give us there as you see it, Tim? And we’d really appreciate it. Thanks.

Tim Cook: Let me talk about the constraints a little more and then Kevan can weigh in on the guidance for revenue. As I had mentioned before, the primary issue is advanced nodes that we run our SOCs on. That’s the primary supply constraint now, and the root cause of it is not a regular supply issue. It’s a demand forecast issue, to be candid, where the iPhone and the Mac are both doing remarkably better than we thought they would do. And we had high expectations, so it wasn’t that our expectations were low, but as you can see from iPhone’s growth being 22% and Mac’s growth at 29%, and the iPhone is 22% year to date as well, that these are extraordinary numbers and the supply chain just has less flexibility in it than normal. So we’ve been pulling supply ahead, and at some point there’s a limit to that. And so we’ve got a quarter that we’re going to be scrambling on the supply side, essentially. And Kevan, you want to add on the revenue guidance?

Kevan Parekh: Yeah. Yeah, thanks, Tim. Ben, let me jump in here. The dynamics Tim mentioned combined with the foreign exchange impact I mentioned earlier sequentially is really what’s built into the 9 to 11 percent guidance we’re giving for the September total company revenue year on year growth rate. Beyond September, we’re not providing any color. At this point I think you mentioned December, so we’re not providing any kind of color or guidance beyond the September quarter.

Ben Reitzes, Melius Research: Ok. And then, if I could just ask, and you guys know what’s in the press all the time. But there’s this little company that is also building a fab in Arizona that you guys have been speculated you guys could work with that could potentially alleviate some, at least your silicon constraints. Is there any possibility that you guys broaden out your silicon providers in a reasonable time frame to alleviate these so we feel better about supply?

Tim Cook: Yeah, let me stress again, this isn’t a partner or supplier issue. This issue is an incredibly strong… it’s a great issue in some ways. It’s an incredibly strong iPhone and Mac product cycle that has really yielded a demand beyond our expectation. In Arizona, we do source over 100 million components this year out of Arizona. And so, it is part of our $600 billion commitment to the U.S., and we could not be more pleased with how that fab has ramped and is producing for us.

Eric Woodring, Morgan Stanley: Thanks so much for taking my questions, guys, and Tim, just echo what everyone is saying, it’s been a pleasure working with you. Hope to still talk to you in the future. I want to maybe focus on pricing here, Tim, and kind of unprecedented for you to take pricing in the ways that you have. I guess two related questions… Is it your intention to pursue some of these multi-year LTAs with your suppliers just to ensure access to supply at pre-agreed prices? And when you approach product pricing in this environment, is it your intention to protect product gross profit dollars? Is it your intention to protect product gross margins? We’d just love the kind of thought process behind the pricing.

Tim Cook: Yeah, on the pricing front, we reluctantly raised prices, I would say. And we did it because we’re in, what I would characterize as a hundred-year flood on the memory pricing with exponential increases in memory prices, and so that was the rationale for it. In terms of our philosophy on dollars or percentages, we look at units, revenue, and margin, and then come to a business judgment as to how to handle that. And so it’s not a mathematical formula that gets us to a specific result or just looking at one dimension of that. We look at all three dimensions and think about it over the long term instead of a 90-day clock. Hopefully that helps.

Eric Woodring, Morgan Stanley: Yeah, yeah, no, that does help. Thank you, Tim. And then just maybe a quick follow-up. I guess, Tim or Kevan. 12% services growth was just a bit below your guidance. I imagine FX maybe played a role there. I think the fiscal 4Q guidance assumes another deceleration. I think the math would imply below 10% year-over-year as reported. So can you maybe just help us understand the kind of function factors underlying that deceleration? And if that’s App Store, which I think some third-party data sources would suggest, is that a function of AI maybe reprioritizing time away from parts of the App Store? I just want to make sure we understand the moving pieces on services, please. Thank you so much.

Kevan Parekh: Hey, Eric. This is Kevan. I’ll take that one. So, let’s walk from kind of the 16 percent in our fiscal second quarter to kind of the 12% that we just talked about in the June quarter that you referenced, and we look at that, relative to the March quarter, foreign exchange was the main driver for the change in the year-on-year growth rate sequentially, and also a couple other factors to keep in mind. One is we had the theatrical release of F1, which is one of the highest grossing sports films in history, and this year we didn’t have a theatrical release. So that had a favorable impact on both the June quarter and also the September quarter in the year ago. We also had some factors that impacted the performance of the App Store. We did see some headwinds in mobile gaming, and then keep in mind, we also made some changes to the App Store business model in certain countries, and in the U.S., we do continue to operate under a court ruling impacting the link-out transactions. But we’re pleased the Supreme Court will hear our appeal. Despite this, the App Store did set a June quarter revenue record. So if we take a step back, there are several positive trends in the services business, and during the June quarter, we saw strong double-digit growth in categories like cloud services, video, payment services, and advertising, and we set revenue records in every category, with June quarter records in advertising, the App Store, AppleCare, Music, and Video, where Apple TV viewership reached an all-time high in the quarter. And then we also set all-time records in cloud services and payment services, where Apple Pay saw a record level of users in both developed and emerging markets. And services also had a June quarter record in emerging markets. And as we outlined in the prepared remarks, you know, our services continue to attract more customers, and we now have surpassed one and a half billion in paid subscriptions, and our transacting and paid accounts hit an all-time high, with double-digit growth in both those two and emerging markets.

So I think when I step back, if I look at, you know, kind of how we landed versus our expectations that we had outlined in the March quarter, for the June quarter, I would say that we roughly met our expectations, but we did see a bit more softness on mobile gaming in the App Store. As we go into the September quarter, what I would say is we expect foreign exchange will continue to be a headwind, and in fact this is a theme that’s impacting the services business moreso than the total company. We expect foreign exchange to drive about a 5 percentage point headwind to the year-on-year growth rate from the March to September quarter. So if we look at the sequential change from the June quarter, the 12% services we reported, to what we’re guiding for the September quarter, we are going to see another 2.5 point sequential headwind.

Aaron Rakers, Wells Fargo: Thanks for taking the questions and also best wishes, Tim. I guess I want to… maybe it tethers with the memory pricing dynamic, but as you look at the demand that you’re seeing right now, I’m curious of how you assess whether or not you’ve seen any pull forward of demand either from the consumer or even the enterprise and education markets, and whether or not you’re factoring that into your views as we look forward at all.

Tim Cook: You’re talking about on iPhone, I assume, in general. We’ve been running at this 22% growth rate for the last while, for this cycle has been a 22% increase year to date, and so it’s not obvious in the data that what you’re asking is true. Obviously, we’ve now had to increase prices on iPad and Mac, and the price elasticity there, it’s just too early to come to a definitive conclusion of what happens there. Because it takes a little while for the channels to adjust since there’s channel inventory and it takes a while for the consumer to respond, and so we’ll understand that more in the weeks ahead.

Aaron Rakers, Wells Fargo: Very helpful, and then as a quick follow-up, maybe more longer-term thematically, as AI proliferates towards the edge and more consumers utilize AI, I’m curious, Tim, if you see AI opening up additional opportunities. I can appreciate that you’re not going to give us specifics, but do you see other kind of addressable markets evolving from AI over time?

Tim Cook: Yes. I think there are enormous opportunities for Apple moving forward in AI. And I’m so excited about Siri AI and kind of where it is and where it’s going, and I’m excited about the feedback that we’re getting there, and of course, the ability to run some percentage of requests on device is also very strategic and sort of a competitive weapon, if you will. So I could not be more excited about the opportunities there.

Wamsi Mohan, Bank of America: Yes, thank you. Tim, first, congrats on your tenure as CEO. You joined back in 2011 when Apple reported $108 billion in revenue and you just delivered a quarter of $109 billion. So just an amazing journey.

Tim Cook: Thank you for that, I really appreciate it.

Wamsi Mohan, Bank of America: Yeah, sure, Tim, it’s been a pleasure. For my question, first on Siri AI, Do you expect that Siri AI would change the capital intensity of Apple, despite the fact that you have the ability to do so much differentiated workloads on device and you have this distributed compute? You do have some requests that go into the backend, both in your own first party cloud as well as third party. So is it right to think that the capital intensity of Apple will change in the future because of Siri AI?

Tim Cook: We use a hybrid model, as I know Kevan has reviewed with you earlier, and so we use some third-party cloud and we do our own data centers, and so there will be a mix. But generally speaking, as you know, we have been growing our OPEX and spending more in AI in general. Quite a bit more. And there are other locations on the P&L other than OPEX, like OCOGS, et cetera, that also have AI expenditures, and so we’ll see what Siri AI does from the cost side of it. But there’s also the ability when people use it a lot for them to move up on an iCloud plan as well, and so what the balance of that is, is a bit uncertain at the moment.

Wamsi Mohan, Bank of America: And John, since you’re on the call, congrats on the new role. I’d love to get maybe just a high-level take from you if you think that the competitive landscape here is changing, especially as you hear about, potentially, companies like OpenAI building an AI-enabled competitive device or SpaceX AI potentially having a phone that could bypass some of the typical carrier tax. Just would love your high-level thoughts on how you see the competitive landscape evolving and Apple’s position there.

John Ternus: Well, thank you for asking. I guess I would just reiterate what Tim said, there is so much opportunity for us with everything that’s happening in this space, and we’re just really focused on our plans and very excited about it.

Samik Chatterjee, J.P. Morgan: Hi, thanks for squeezing me in here and Tim, best wishes from my side as well. Maybe just for my first one, if I go back to WWDC when you announced Siri AI, you also did mention along with the rollout that probably we won’t have the initial rollout in China and Europe, so just wanted to get your thoughts on that front and any more color in terms of what hurdles you need to cross to be able to launch it in those regions.

Tim Cook: Thank you. Yeah, thanks for the question. Let me take them individually. If you look at the EU, we’re working closely with the Commission. Obviously, our complete desire is to launch everything everywhere at the same time. That’s always the philosophy that we have. We have not been able to do that in the European Union, but we’re working closely with them to try to get to something that would allow us to offer Siri AI there. It is offered, or will be offered for the Mac there, because the Mac is not covered by the same regulations as the iPhone and the iPad. So, net-net, we’re working with them, and hope to reach some sort of solution. If you then look at China, last week we received approval to ship sort of the original features of Apple Intelligence. Things like Clean Up and so forth, and so we’re working now through the rollout of those, and there will be more work required down the road for Siri AI, but we’re at the front end of that.

Samik Chatterjee, J.P. Morgan: Follow-up, Kevan, just not to beat sort of this FX thing to death here, but if I look at the gross margin, you delivered 48% in the quarter without the tariff refund benefit. You’re guiding to like 46 and a half. Any way to walk us through the sequential driver there and how much of that is FX impacting it versus maybe like increased commodity costs that’s driving that sequential moderation because it does seem a bit more atypical than your normal sort of years.

Kevan Parekh: Yes, that’s a good question. So let me walk through kind of what’s impacting our gross margins. We look at our gross margin change from the 49.3% we had a total company level for the March quarter, and as you mentioned, the 48.1% adjusted for the tariff refund in the June quarter, that hundred and twenty basis point change, if you look at the drivers of that, more than 100% of that can be explained by the memory cost change that Tim outlined. While FX was a factor, really the main driver was really the memory cost impact, and as Tim outlined earlier when we talked a bit about the dynamics around the memory cost, is we did see some partial offsets from things like the benefit of carry-in inventory, reduction in non-memory component costs, and some favorable mix. We are seeing the same dynamics when you go from the 48.1 that we printed in the June quarter to the 46.5 midpoint you referenced of our range without the tariff refund impact. That 160 basis point change is also… more than that is explained by the change in memory costs, and we had partial offsets, again, from things like the benefit of carrying inventory, lower cost and non-memory components, and as well favorable mix. I think that FX was a pretty minimal impact when you look at that versus the memory, and so generally, the sequential change from the March quarter to the 46.5 you referenced is really driven by memory.

Samik Chatterjee, J.P. Morgan: Great. Thank you both for taking my questions. And congrats again, Tim.

Tim Cook: Thank you so much for saying that, I appreciate it.