AAPL Earnings: Apple Stock Slides despite Topping Expectations

Shares of Apple (AAPL) fell in after-hours trading after the tech giant reported earnings for its second quarter of Fiscal Year 2025. Earnings per share came in at $1.65, which beat analysts’ consensus estimate of $1.62 per share. Sales increased by 5% year-over-year, with revenue hitting $95.4 billion. This also beat analysts’ expectations of $94.54 billion.

When breaking down the numbers, the iPhone generated $46.841 billion in sales, while iPad and Services revenues contributed $6.402 billion and $26.645 billion, respectively. Additionally, the Wearable, Home, and Accessories segment recorded revenues of $7.522 billion, while Mac sales hit $7.949 billion.

During the second quarter, AAPL returned over $29 billion to shareholders. Dividends made up $3.758 billion, while buybacks made up the remaining $25.242 billion. Apple has regularly returned massive amounts of capital to shareholders in each of the most recent quarters, as demonstrated in the image below from Main Street Data. The board of directors has also authorized an additional program to repurchase up to $100 billion of the Company’s common stock.

Apple’ Outlook

Looking forward, Apple expects fiscal third-quarter revenue to grow in the low to mid single digits year-over-year, which is roughly in line with the 3.6% growth analysts estimate. In addition, gross margins are projected to be between 45.5% and 46.5%.

Management also noted that it did not see any “pull forward impacts” from tariffs in the March quarter, although they admitted they can’t precisely predict future tariff effects. Interestingly, if tariffs stay the same, the firm estimates that about $900 million will be added to costs in the next quarter.

Is AAPL Stock a Buy?

Turning to Wall Street, analysts have a Moderate Buy consensus rating on AAPL stock based on 18 Buys, seven Holds, and three Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average AAPL price target of $233.48 per share implies 9.7% upside potential. However, it’s worth noting that estimates will likely change following today’s earnings report.

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