How Did Apple Perform and Why Did Netflix Split?

TL;DR

Apple narrowly exceeded fourth-quarter revenue and earnings expectations, but weaker-than-expected Greater China and iPhone results tempered the report. Services, Mac, and wearables revenue surpassed forecasts. Netflix separately announced a 10-for-1 stock split intended to make its shares more accessible to employees, while leaving each investor’s total holding value unchanged at the time of the split.

Transcript

Hello and welcome to Ask for a Trend. I'm Josh Lifton and we're diving straight into another big tech earnings report here. Apple's fourth quarter result, they are just hitting the wire. Let's take a look what we got here. Q4 EPS 185. So, Street was at 177. Uh top line Q4 revenue 102.47 47 billion. Street was at 102.19 billion. I'm looking for uh G... Read More

Key Insights

• Apple’s fourth-quarter results exceeded headline expectations, with earnings per share of $1.85 versus $1.77 expected and revenue of $102.47 billion versus $102.19 billion expected. The narrow revenue beat and stronger earnings established a positive headline, but underlying results were mixed.
• Greater China revenue was the largest apparent weakness, reaching $14.49 billion compared with a Street expectation near $16.43 billion. Angelo Zino called China a significant miss and emphasized the need to hear Tim Cook’s outlook for demand and inventory conditions.
• iPhone revenue was $49.03 billion, up 6% year over year but below the approximately $49.33 billion consensus estimate. The analyst said investors should focus on December-quarter momentum for Pro devices and demand in the United States, Western markets, and China.
• Services revenue was a major strength, totaling $28.75 billion against expectations of $28.18 billion. Zino described services as a longstanding bright spot and projected approximately 12% to 13% growth over the next several quarters, subject to management’s forthcoming commentary.
• Mac and wearables revenue exceeded expectations, with Mac revenue reaching $8.73 billion versus $8.55 billion expected and wearables, home, and accessories producing $9.01 billion versus approximately $8.6 billion expected. These categories helped offset softer iPhone and China figures.
• The December quarter is more informative for Apple demand because the September quarter includes only a couple of weeks of new-phone availability and can be more supply-driven. Holiday-quarter commentary is therefore important for evaluating sustained China growth, product availability, and device momentum.
• Apple’s AI outlook depends largely on management’s tone rather than detailed disclosures during the earnings call. Zino expected little specific AI information before a developers conference, but wanted Tim Cook to express confidence about an AI rollout during 2026 and the availability of a backup plan.
• Netflix’s 10-for-1 stock split will turn every existing share into 10 shares while initially preserving the investor’s total holding value. Netflix said the action would make the stock more accessible to employees participating in its stock option program after shares closed above $1,000.

Questions & Answers

Q: Did Apple beat fourth-quarter earnings expectations?

Apple beat the headline fourth-quarter estimates presented in the report. Earnings per share were $1.85, compared with the Street expectation of $1.77. Revenue was $102.47 billion, narrowly above the expected $102.19 billion. The overall result was therefore stronger than forecast, although misses in Greater China and iPhone revenue made the underlying performance more mixed.

Q: Why was Apple’s Greater China revenue a concern?

Apple generated $14.49 billion in Greater China revenue, while the Street expectation was closer to $16.43 billion. Angelo Zino identified this result as the most significant miss in the report. He said the September quarter contained several moving parts, including inventory, sell-in versus sell-through, and limited availability of the newest phone, making management’s December-quarter outlook especially important.

Q: How did Apple’s iPhone revenue compare with estimates?

Apple reported fourth-quarter iPhone revenue of $49.03 billion, representing 6% year-over-year growth. That figure was below the Street consensus of approximately $49.33 billion. The analyst said investors should listen for management’s assessment of December-quarter momentum, particularly demand for Pro devices in the United States and other Western markets, as well as base-model demand in China.

Q: How did Apple’s services business perform?

Apple’s services business generated $28.75 billion in fourth-quarter revenue, exceeding the analyst expectation of $28.18 billion. Angelo Zino described services as a higher-growth, higher-margin bright spot for the company. He expected the division to maintain growth of approximately 12% to 13% over the next several quarters, while noting that investors still needed confirmation from management.

Q: Why is Apple’s December-quarter guidance important?

The December-quarter commentary is important because the September quarter includes only a couple of weeks of sales for the newest phone and may reflect supply conditions more than underlying demand. Investors want information about holiday demand, China momentum, available inventory, the performance of base and Pro models, and whether the strong China growth seen in the June quarter can continue.

Q: What did the analyst say about Apple’s AI strategy?

Angelo Zino said Apple was unlikely to provide extensive AI details during the earnings call because the company typically reserves major information for a developers conference or related announcements. He wanted Tim Cook to express confidence that Apple would deliver its AI plans during 2026. Zino also suggested Apple should have a backup plan, potentially involving an outside partner.

Q: What does Netflix’s 10-for-1 stock split mean for shareholders?

Netflix’s 10-for-1 split means that each share an investor owns will become 10 shares. The price per share will appear proportionally lower, but the total value of the investor’s position will remain the same at the time of the split. Shareholders of record at the close of trading on November 10, 2025, are eligible for the additional shares.

Q: When will Netflix shares begin trading at the split-adjusted price?

Netflix said split-adjusted trading is scheduled to begin on Monday, November 17, 2025. Shareholders of record at the close of trading on Monday, November 10, 2025, will receive nine additional shares for every share they own after the close of trading on Friday, November 14. The company said the split would improve accessibility for employees in its stock option program.

Summary & Key Takeaways

• Apple reported fourth-quarter earnings per share of $1.85, above the Street estimate of $1.77, while revenue reached $102.47 billion versus expectations of $102.19 billion. The overall results were slightly better than forecast, although performance varied considerably across geographic markets and major product and service categories.

• Greater China revenue of $14.49 billion missed the roughly $16.43 billion expectation, while iPhone revenue of $49.03 billion fell below the $49.33 billion consensus despite growing 6% year over year. Analyst Angelo Zino said December-quarter commentary would provide a more useful indication of demand, especially for China and Pro devices.

• Netflix announced a 10-for-1 stock split after its shares closed just above $1,000. Each existing share will become 10 shares without changing the total value of the investment at the split. Split-adjusted trading is scheduled to begin Monday, November 17, following the distribution of additional shares on Friday, November 14.