The consumer tech giant Apple (NASDAQ: AAPL) reported earnings for its 2026 second fiscal quarter after the market closed on April 30. Earnings per share of $2.01 beat Wall Street consensus estimates by $0.06, while revenue of over $111 billion beat estimates by over $1.5 billion.
Shares were nearly 4% higher in after-hours trading, as of 6:23 p.m. ET.
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Apple beat estimates across most of its key performance indicators, though it missed one big one. Revenue for the iPhone, Apple’s flagship product, came in at nearly $57 billion, slightly below estimates.
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The miss comes after sales of the new iPhone 17 had gotten off to a terrific start earlier this year, although some analysts believed that had more to do with pent-up demand than the actual new model itself.
Apple’s earnings come one day after “Magnificent Seven” companies Microsoft, Alphabet, Amazon, and Meta Platforms all just reported earnings. All four of these companies raised their full-year capital expenditure guidance, largely to fund the build-out of artificial intelligence infrastructure.
On a full-year basis, each of these companies is planning over $100 billion in capex, with Amazon guiding for as much as $200 billion. But while most “Magnificent Seven” companies pour into capex, Apple continues to execute the classic shareholder-friendly playbook.
Another round of buybacks and a dividend hike
Through the first six months of its fiscal year, Apple has only spent about $4.3 billion in capex. Meanwhile, Apple’s board of directors has hiked its quarterly dividend to $0.27 per share, a 4% increase, and authorized an additional $100 billion share repurchase program.
When a company buys back stock, it reduces the number of outstanding shares, thereby increasing earnings per share for investors.
Apple has already repurchased nearly $37 billion through the first half of fiscal year 2026, while distributing roughly $7.7 billion in dividends to shareholders. The company is known for executing the largest share buyback program in corporate history, repurchasing over $840 billion since 2012.
As has been discussed many times now, Apple has chosen to sit back while others in the “Magnificent Seven” engage in an AI arms race, working quickly to build data centers and acquire AI infrastructure, like servers and chips.
But the heavy capex has cut into share repurchases for some in the “Magnificent Seven.” For instance, Meta didn’t repurchase any stock in the first three months of 2026, down from $12.7 billion in repurchases in the first quarter of 2025. Alphabet also didn’t repurchase any stock in the first three months of 2026, down from over $15 billion in repurchases in the same period of 2025.
Apple has been criticized for lacking a more definitive AI strategy, and incoming CEO John Ternus will eventually need to establish one.
But in spending so much on capex, others in the “Magnificent Seven” are taking a big risk. Apple is continuing a practice that made the company one of Warren Buffett’s favorite stocks and has contributed to the significant gains made by all shareholders during Tim Cook’s 15-year stint as CEO.
Apple is a good stock for investors looking for a large, dominant tech player with more limited exposure to AI.
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Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, and Microsoft. The Motley Fool has a disclosure policy.
While “Magnificent Seven” Companies Pour Hundreds of Billions into AI Infrastructure, Apple Continues to Execute the Classic Shareholder-Friendly Playbook was originally published by The Motley Fool