iPhone sales exceeded $85.3 billion despite challenges in AI.
iPhone sales exceeded $85.3 billion despite challenges in AI.
Apple reports that the iPhone achieved its “most successful” quarter, generating over $85.3 billion in revenue during the last few months. The company made this announcement as part of its Q1 2026 earnings statement, which also disclosed record revenues of $143.8 billion, a 16 percent increase compared to last year.
“The interest in the iPhone is remarkable, with revenue increasing 23 percent compared to last year,” says Apple CEO Tim Cook during an investor call. “This is our best iPhone lineup to date, and it’s incredibly popular.”
iPhone purchases soared despite setbacks related to an upgraded AI Siri, with the standard iPhone 17 offering numerous features that were once limited to “Pro” models, such as an always-on display and a screen with enhanced refresh rates. Speculation that iPhone Air sales fell below expectations did not seem to significantly affect results.
The “high demand” for the iPhone 17 has resulted in a “limited” supply, according to Cook. He noted that the company is “experiencing less adaptability in the supply chain” regarding the advanced process nodes utilized to create the device’s chip. Simultaneously, Apple’s services revenue, which encompasses subscriptions like Apple Music, iCloud, and Apple TV, increased by 14 percent year over year, while revenue from Mac and wearables saw a decline.
In the upcoming months, Apple plans to introduce promised AI-driven personalization features to Siri. Apple is collaborating with Google for this enhancement, which will utilize a customized version of Google’s Gemini AI model.
Additionally, the company is acquiring an AI startup, named Q.ai, for $2 billion, according to the Financial Times. While specifics on how Apple intends to employ the startup’s technology are not available, the Financial Times indicates that Q.ai’s patents “demonstrate its technology being utilized in headsets or eyewear, using ‘facial skin micro movements’ for communication without speaking.”
Speculation suggests that Apple has even grander AI aspirations, as a report from Bloomberg’s Mark Gurman indicates the company plans to transform Siri into an AI chatbot integrated directly into its iPhone and Mac. Apple is also reportedly developing an AI-enhanced web search capability for Siri.
