How Much Of Apple Stock Rides On One Product? Trefis Team Fri, October 16, 2026 at 9:38 AM EDT 4 min read AAPL +1.21% MSFT -1.39% GOOG -1.33% AMZN -0.27% DELL -3.05% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Investors in Apple (AAPL) know the iPhone drives the business, but its sheer scale remains striking. The company generated $54.3 billion from iPhone sales during fiscal Q3 2026, the June quarter. That figure accounted for roughly half of its total $109.4 billion in revenue. Furthermore, iPhone sales climbed 22% from a year earlier. This outpaced the overall company, which grew 16%. So what has been pushing iPhone sales up this fast?
Why Have Apple's iPhone Sales Grown So Fast?
Customers demanded more iPhones than Apple initially projected. During the fiscal Q3 2026 earnings call on July 30, 2026, executives attributed the growth across the iPhone and Mac to very high demand, noting a strong product cycle for both device lines. Apple actually ran short of supply, mainly on the Mac and to a lesser extent on the iPhone. Management linked this shortfall to its internal demand forecast, stating that both products sold far better than the company expected.
At the same time, higher manufacturing costs presented a distinct headwind. Executives noted that the company raised prices reluctantly, citing what it described as "a 100-year flood on the memory pricing." Apple expects to pay even higher memory costs in the September quarter. Consequently, the rapid growth of the iPhone arrived alongside a rising bill for memory components. Management also indicated that it sees memory prices still climbing beyond September.
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Is Demand For The New iPhones Already Cooling?
Apple expects a slower pace of growth, though not an outright decline. During the call, management stated that currency and supply limits explain most of the expected slowdown in total sales. Executives guided for iPhone sales to grow at a mid-teens rate from a year earlier in the September quarter, fiscal Q4 2026, compared with the 22% rate recorded in June. The company also expects the supply shortfall to increase significantly in that quarter, affecting the iPhone, Mac and iPad.
A more severe concern emerged later. On October 9, Reuters reported, citing Nikkei Asia, that Apple told some suppliers to cut production of components for the newly launched iPhone 18 Pro and iPhone 18 Pro Max because of soft demand.
The broader context involves the massive scale of Apple devices already in use. Management reported that the installed base of over two and a half billion active devices reached another all-time high. Additionally, Apple gained share globally during the June quarter, according to IDC. The available evidence now points both ways. The company's guidance, established on July 30, still calls for growth. However, the October 9 report regarding cut orders for the new Pro models points the other way.
Apple Stock Has Fallen Harder Than The Market
In four of the five market shocks since 2022, Apple stock fell further than an S&P 500 ETF. The deepest drop occurred during the 2025 tariff shock, when Apple stock fell 30% against 19% for the fund. Similarly, during the 2022 inflation shock and Fed tightening, the stock fell 28% against a 24% decline for the fund.
Investors today pay a significant premium for the shares. Apple trades at 38.9 times its earnings over the past twelve months, compared with 22.7 for the S&P 500. The company's price-to-sales multiple, measured on sales for the four quarters to June 2026, hit its highest level of the 40 quarter-ends since fiscal Q4 2016. This valuation likely assumes that iPhone demand stays strong.
For shareholders, current concerns are real but moderate. Apple still guides to mid-teens iPhone growth, and its installed base remains at a record. However, at 38.9 times earnings, the stock leaves little room for a miss. For the risk to be worth taking, demand for the new iPhones needs to hold up while memory costs are still rising. Moving forward, iPhone revenue growth, measured against the mid-teens guide, is the exact number to watch in Apple's fiscal Q4 2026 report, expected on or around November 2, 2026.
Is Too Much Of Your Wealth Riding On One Stock?
One number was enough to change how Apple looks to its holders. When one position grows into a large part of your wealth, a sharp fall can hurt your whole plan, and selling to spread the money out can bring a large tax bill. Glenn Caldicott, CIO of our Boston-based partner firm Empirical Asset Management, an SEC-registered investment adviser, offers a free 15-minute strategy review of ways to protect a concentrated position and unwind it with less tax.
