Apple earnings beat forecasts on iPhone 17 demand

Apple on Thursday said it had its best start to the year ever when it came to earnings, with iPhone demand and digital service sales helping it beat expectations.

Apple reported profit of $29.6 billion on revenue of $111.2 billion in the recently ended quarter.

"Today Apple is proud to report our best March quarter ever," chief executive Tim Cook said in an earnings release, noting revenue hit a record high for the quarter ending in March.

Apple shares slipped slightly, however, as investors mulled its future in a tech world shaken up by artificial intelligence.

During the quarter, iPhone sales grew double digits in every country where it does business, and its services unit reached an all-time record high, according to Cook.

Changing of the guard

The earnings come as Apple prepares for a changing of the guard, with Cook to step down as chief executive late this year.

The future of Apple is being entrusted to a company veteran said to combine hardware brilliance with "the soul of an innovator."

John Ternus, 50, will take over as Apple chief executive in September, with Cook becoming executive chairman of the iPhone maker's board of directors.

A big question will be whether Ternus has "the appetite for the kind of bold, occasionally uncomfortable decisions" that defining an Apple AI platform will require.

Legendary Apple co-founder Steve Jobs was known for brutal honesty and unyielding perfectionism that led to culture-changing devices.

50th anniversary

Apple celebrates its 50th anniversary as AI challenges the Silicon Valley legend to prove it can deliver yet another must-have innovation.

Apple's hit products — the Mac, the iPhone, the Apple Watch and the iPad — command a cult-like following, long after the company's humble beginnings on April 1, 1976, in Jobs' Cupertino, California garage.

A concern haunting investors is that Apple appears to be easing into generative AI while rivals Google, Microsoft and OpenAI race ahead.

A promised upgrade to its Siri digital assistant was delayed in what analysts called a rare stumble for the company.

And rather than relying on its own engineers to overhaul Siri, Apple has turned to Google for AI capability.

But whether built in-house or outsourced, Apple's obsession with user privacy and its premium hardware could position it to drive widespread adoption of personalized AI -- and make it profitable, a goal that has proved elusive for much of the AI industry.