Apple’s AAPL fourth-quarter fiscal 2025 results, to be reported on Oct. 30, are expected to have benefited from strong Services revenues and Mac sales.
The Services business is expected to have benefited from a growing installed base of devices as well as subscriber base of its offerings, including Apple TV+, Apple Pay, Apple Music and more. Apple had more than 1 billion paid subscribers across its Services portfolio at the end of the fiscal third quarter. Paid subscriptions grew double-digits, a trend expected to have continued in the to-be-reported quarter.
However, while Mac sales are expected to grow year over year, iPad is anticipated to decline.
Apple Inc. Revenue (TTM)
Apple Inc. revenue-ttm | Apple Inc. Quote
Click here to learn how Apple’s overall fiscal fourth-quarter earnings results are likely to be.
Services Growth to Ride on Apple TV+, Strong Install Base
Apple’s streaming business, Apple TV+, is benefiting from a strong content portfolio. The service won 22 Emmys at the 77th Primetime Emmy Awards, best-ever in Apple TV+’s history, driven by The Studio, Severance and Slow Horses.
However, Apple TV+ is suffering from stiff competition in the streaming space from the likes of Disney’s DIS Disney+, Netflix NFLX and Peacock. For the fiscal fourth quarter, Disney expects a modest increase in its Disney+ subscriber base on a sequential basis. For the fourth quarter of fiscal 2025, Netflix projects $11.96 billion in revenues with 16.7% growth, featuring major releases, including Stranger Things’ final season and NFL Christmas games.
Apple raised the Apple TV+ monthly subscription to $12.99. Revenues from Apple TV+ are reported under Apple’s Services business, which accounted for 29.2% of third-quarter fiscal 2025 sales.
The Zacks Consensus Estimate for fourth-quarter fiscal 2025 Services is pegged at $28.05 billion, suggesting 12.3% year-over-year growth.
Apple to Benefit From Y/Y Growth in Mac Sales
The PC segment climbed up in the third quarter of calendar 2025. Per IDC, Apple had a market share of 9%, up 30 basis points (bps) on a year-over-year basis. Shipment grew 13.7% year over year to 6.8 million. Per Gartner, Apple had a market share of 8.9%, up 20 bps year over year.
In terms of shipments, Apple trails Lenovo’s growth of 17.3%, per IDC data. Dell Technologies’ DELL shipment increased 2.6%, while HP saw shipment growth of 10.7%. According to Gartner’s list, Lenovo was placed at the #1 spot with shipment growth of 16.6%, trailed by Apple’s 10.7%, HP’s 10.6% and Dell Technologies’ 2.5% growth.
The Zacks Consensus Estimate for fiscal fourth-quarter Mac net sales is pegged at $8.44 billion, suggesting 9% year-over-year growth.
Apple’s iPad Sales to Decrease Y/Y
iPad accounted for roughly 7% of fiscal fourth-quarter net sales. However, iPad revenues are expected to have suffered from sluggish demand in the to-be-reported quarter.
The Zacks Consensus Estimate for fiscal fourth-quarter iPad net sales is pegged at $6.9 billion, suggesting a 0.8% year-over-year decline.
Zacks Rank
Apple currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
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This article originally published on Zacks Investment Research (zacks.com).