Tim Cook Highlights AI, iPhone 16, and China Rebound Following 'Exceptional' Quarter

Following the release of Apple's third-quarter earnings, CEO Tim Cook offered new insights on the company's AI strategy, M&A outlook, and the effects of recent U.S. tariffs.

Cook called it "an exceptional quarter by any measure," as Apple reported $94.04 billion in revenue — a 10% year-over-year increase and the company's strongest growth since late 2021. Net income reached $24.43 billion, with earnings per share of $1.57, beating analyst expectations across the board.

Speaking to CNBC, Cook said Apple views AI as "one of the most profound technologies of our lifetime," and confirmed the company is "significantly growing" its investment in the field. AI is being embedded "across our devices, across our platforms, and across the company," he noted.


Cook also addressed Apple's acquisition strategy, revealing the company had purchased around seven smaller firms this year. While none were major in dollar value, Cook said Apple remains "open to M&A that accelerates our roadmap." That follows reports of internal talks about acquiring AI search startup Perplexity.

On tariffs, Cook said about one point of the company's 10% revenue growth came from customers purchasing ahead of potential price increases. Tariff-related costs had previously been estimated at $900 million for the June quarter. Former President Trump has threatened tariffs on iPhones not made in the U.S.

Apple saw a 4% sales increase in Greater China, including Hong Kong and Taiwan, reversing declines in the two prior quarters. Cook credited government subsidies for driving some of that growth: "The subsidy does apply to some of our products, and it clearly helps," he said.

iPhone sales jumped 13% to $44.58 billion, driven by strong demand for the iPhone 16. Cook noted "strong double-digit" growth compared to the iPhone 15.


Mac revenue rose nearly 15% to $8.05 billion, boosted by the launch of the new M4 MacBook Air. Services climbed 13% to $27.42 billion, with double-digit growth in App Store revenue and increased iCloud subscriptions.

However, not all segments saw gains. iPad revenue declined 8% to $6.58 billion despite the release of a new low-cost model in March. The Other Products category, which includes Apple Watch and AirPods, dropped 8.6% to $7.4 billion.

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