Apple is growing without the AI spending spree engulfing Big Tech: Chart of the Day

Apple is growing without the AI spending spree engulfing Big Tech: Chart of the Day Jared Blikre Fri, July 31, 2026 at 4:19 PM GMT+2 3 min read AAPL GOOG META AMZN MSFT Apple ( AAPL ) is growing like an AI spender. It is not spending like one. Apple stock sank over 9% in early trading on Friday as investors looked past the strong quarter to slowing growth, tighter supply, and another hit to margins from soaring memory costs.

If that loss holds into the close, it would mark Apple's worst day since the depths of the early pandemic sell-off on March 16, 2000. More from Yahoo Scout How is Apple's AI strategy different from other tech giants? Where is Apple's revenue growth coming from this quarter?

Why did Apple stock drop despite strong quarterly results? What's causing Apple's margin pressure and rising costs? Revenue jumped 16% to $109.

4 billion in the June quarter, powered by a 22% rebound in iPhone sales and 29% growth from the Mac. Earnings per share rose 29% to $2. 02, comfortably beating Wall Street's forecast.

Apple also reported a gross margin of 50. 1%, meaning the company kept just over half of each sales dollar after the direct costs of producing its devices and services. That headline needs an asterisk.

Tariff refunds added roughly two percentage points to gross margin, putting the underlying figure closer to 48. 1%. Even after stripping out that boost, Apple delivered faster growth and strong profitability without incurring an enormous AI infrastructure bill.

Bloomberg, Yahoo Finance analysis of AlphaSpace data Microsoft ( MSFT ), Alphabet ( GOOG , GOOGL ), Meta ( META ), and Amazon ( AMZN ) are pouring hundreds of billions of dollars into chips, data centers, and power infrastructure. That spending can pay off. Microsoft's record $41 billion quarterly build-out came alongside faster Azure growth, while Google Cloud recently delivered accelerating growth and widening profitability .

But the bills keep rising. Apple is taking another route. That route is cheaper, but it is not free.

Apple expects revenue growth to slow to between 9% and 11% in the September quarter as foreign exchange and worsening supply constraints weigh on the iPhone, Mac, and iPad. Margins face an even bigger squeeze. Apple guided to a gross margin of 47% to 48%, including another one-point benefit from tariff refunds.

Strip that out, and the midpoint falls to roughly 46. 5%. Management said more than all of the decline from June's underlying 48.

1% margin is explained by higher memory costs. Apple expects those costs to rise again this quarter and keep climbing beyond September. Its research and development spending jumped 32% to $11.

7 billion, so this is hardly a company starving AI of investment. Apple is relying on a mix of on-device processing, its own servers, and third-party cloud capacity rather than building the same vast public-cloud network as its rivals. CEO Tim Cook acknowledged that Siri AI could eventually make Apple more capital-intensive.

For now, management said the cost — and how much Apple can recover through paid iCloud upgrades — remains uncertain. Story Continues The quarter also showed where Apple's latest burst of growth came from. Bloomberg, Yahioo Finance analysis of AlphaSpace data Services revenue rose 12%, missing expectations.

Hardware did the heavy lifting, with iPhone growth running well ahead of services for a third straight quarter. Apple still has to turn Siri AI into another upgrade cycle, while memory costs squeeze the economics of the devices carrying the growth. As Cook put it, "We're in what I would characterize as a 100-year flood on the memory pricing.

" Jared Blikre is the global markets and data editor for Yahoo Finance. Follow him on X at @SPYJared or email him at jaredblikre@yahooinc. com.