AAPL Apple Inc.

Suhasini Chandramouli (Director of Investor Relations): Good afternoon and welcome to the Apple Q1 fiscal year 2026 earnings conference call. My name is Suhasini Chandramouli, Director of Investor Relations. Today's call is being recorded. Speaking first today is Apple CEO, Timothy D. Cook. And he'll be followed by CFO, Kevan Parekh. Please note that some of the information you'll hear during our discussion today will consist of forward-looking statements, including, without limitation, those regarding revenue, gross margin, operating expenses, other income and expense, taxes, capital allocation, and future business outlook. These statements involve risks and uncertainties that may cause actual results or trends to differ materially from our forecast, including risks related to the potential impact to the company's business and results of operations from macroeconomic conditions, tariffs, and other measures, and legal and regulatory proceedings. For more information, please refer to the risk factors discussed in Apple's most recently filed reports on Form 10-Q and Form 10-K and the Form 8-K filed with the SEC today along with the associated press release. Additional information will also be in our report on Form 10-Q for the quarter ended December 27, 2025, to be filed tomorrow and in other reports and filings we make with the SEC. Apple assumes no obligation to update any forward-looking statements, which speak only as of the date they are made. I'd now like to turn the call over to Tim for introductory remarks. Timothy D. Cook (CEO): Thank you, Suhasini. Good afternoon, everyone. And thanks for joining the call. I am proud to say that we just had a quarter for the record books. We are reporting our best-ever quarter with $143.8 billion in revenue, up 16% from a year ago and exceeding our expectations. The demand for iPhone was simply staggering, with revenue growing 23% year over year and all-time records across every geographic segment. Services set an all-time revenue record as well, up 14% from a year ago, and EPS reached an all-time record of $2.84, growing a robust 19% year over year. We set all-time revenue records in The Americas, Europe, Japan, and the rest of Asia Pacific and grew in the vast majority of markets we track. We continue to gain momentum in emerging markets, which includes India, where we saw strong double-digit revenue growth. Greater China also grew 38% year over year, driven by iPhone, which had record upgraders and double-digit growth on switchers. Apple's December results underscore our relentless commitment to innovation, to our customers, and to our mission to build the best products and services in the world. Now I'd like to take a closer look at results from across our lineup, beginning with iPhone. As I mentioned earlier, it was a fantastic quarter for iPhone with an all-time revenue record of $85.3 billion, up 23% year over year. This is the strongest iPhone lineup we've ever had and by far the most popular. Throughout the quarter, customer enthusiasm for iPhone was simply extraordinary. Users were incredibly excited about everything it enables them to do. iPhone 17 Pro and 17 Pro Max deliver the ultimate iPhone experience. They feature the best-ever performance and battery life on an iPhone, the most advanced camera system, and a striking design. iPhone Air, our slimmest and lightest smartphone yet, packs powerful capabilities into an ultra-slim and sleek design. And iPhone 17 is a truly fantastic upgrade and an incredible value. Turning to Mac, revenue was $8.4 billion for December. We were pleased to see the Mac installed base reach another all-time high, with nearly half of customers who purchased a Mac being new to the product. The M5-powered 14-inch MacBook Pro takes a huge leap in AI performance thanks to the next-generation GPU architecture and a faster neural engine. From the world's most popular laptop for consumers and businesses in MacBook Air to the small and spectacular Mac mini, every Mac in our lineup has something special to offer users. And with the recently released Apple Creator Studio, available across Mac, iPad, and iPhone, creators have more tools at their fingertips to make incredible music or turn their devices into a video production studio. Meanwhile, iPad saw December revenue of $8.6 billion, up 6% from a year ago, with an all-time record for upgraders. We are proud to have our strongest lineup ever, from iPad powered by A16, which is proving to be incredibly popular, to iPad Air with its amazing versatility, to the unbelievably powerful M5 iPad Pro with its remarkably thin and light design. It's no wonder that iPad continued to be the most popular tablet in the world. Across wearables, home, and accessories, revenue was $11.5 billion. With Apple Watch Ultra 3 and Apple Watch Series 11, users are tapping into a comprehensive set of health and wellness features to help them meet their health goals. In a recent survey, we see an increasing number ... [transcript truncated at 5,000 chars — full text available via API]