By James Simons-
Technology giants Apple and Amazon successfully defied widespread industry predictions this quarter, both revealing financial results significantly better than expected. Apple’s remarkable success stems largely from record-breaking sales of its flagship iPhone, whereas Amazon’s powerful performance rested heavily on its cloud computing division, Amazon Web Services (AWS).
Almost 59 million iPhones were sold worldwide from July-September. Pic: Reuters
These stronger Big Tech Quarterly Results arrived despite widespread market uncertainty, including lingering concerns over the economic impact of global trade tariffs and intense investment in artificial intelligence (AI). Market analysts had exercised caution regarding both companies, along with their key competitors, because of the geopolitical instability caused by tariffs and skepticism about whether recent massive AI investments would translate into immediate revenue.
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The record revenue achievement proved particularly welcome for Apple Chief Executive Tim Cook, especially considering the punishing tariffs introduced by President Donald Trump against primary iPhone manufacturing hubs like India and China. These tariffs directly cost Apple approximately $1.1 billion (£824 million) during the recently concluded quarter. Company projections anticipate an even higher financial impact, expecting another $1.4 billion (just over £1 billion) in tariff costs during the final three months of the current year.
Tim Cook was famously once referred to by Donald Trump as ‘Tim Apple’. Pic: Reuters
Nevertheless, consumers enthusiastically embraced the new iPhone 17 range. Customers were won over primarily by an attractive price point which remained stable and did not increase beyond the cost of last year’s model, notably in lucrative markets like the United States and Europe. These factors contributed to impressive sales totaling $49 billion (£36.1 billion) throughout the July-September period, representing a significant six per cent increase compared to the previous year.
Global market analyst IDC reported that consumers purchased almost 59 million iPhones worldwide during the July-September quarter alone. . This performance places Apple firmly in second place globally, just behind Samsung, which shipped 61.4 million of its Android-powered phones during the same period. Buoyed by the strength of the iPhone results, Apple earned a substantial $27.5 billion (£21.4 billion), or $1.85 per share (£1.44), nearly doubling its profit year-over-year. Overall company revenue climbed a solid eight per cent from a year ago to reach $102.5 billion (£80 billion).
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Amazon’s impressive performance this quarter relied heavily on its cloud computing arm, Amazon Web Services (AWS), demonstrating robust growth despite a highly publicized service outage last week that temporarily knocked out thousands of dependent websites. AWS revenue accelerated by 20.2 per cent to reach an impressive $33 billion (almost £25 billion).
While welcoming its latest results, Amazon has also issued a cautious sales outlook. Pic: Reuters
CEO Andy Jassy highlighted this pace, noting the division had not experienced such rapid growth since 2022. This enormous profitability makes cloud growth a primary focus for the company. Importantly, AWS now accounts for a staggering 60 per cent of Amazon’s total operating income, solidifying its essential role in the company’s financial structure. Furthermore, Amazon faces ever-growing pressure from powerful industry rivals such as Google and Microsoft, both of whom also reported significant revenue leaps earlier this week. Companies like Amazon introduce AI into nearly every facet of their vast operations, hoping to substantially reduce costs and consequently boost productivity across their enterprises.
This intense focus on efficiency has unfortunately coincided with tens of thousands of job losses across various US tech firms throughout the current year. Meanwhile, Amazon issued a cautious sales outlook for the upcoming fiscal fourth quarter, citing continued trade tariffs as a possible obstacle in their revenue roadmap.
Federal Reserve Chair Jerome Powell recently addressed the AI boom, saying he did not believe the sector represented a speculative bubble like the dot-com era, when many companies were mere “ideas rather than businesses.” Powell stressed that today’s AI leaders genuinely “actually have earnings,” signaling confidence in the future of the sector.
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