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The Apple (NASDAQ: AAPL) after-hours share price was in sprightly form as investors reacted to an(other) encouraging set of quarterly numbers from the US tech titan on Thursday (30 October).
Revenue came in at $102.5bn. That’s an increase of 8% on that achieved one year ago. But it was also a bit higher than analysts had been expecting.
As normal, iPhone sales made up a significant proportion of that figure. Their contribution of $49bn was an improvement of roughly 6% on the previous financial year.
And Apple’s bottom line? Well, profit hit $27.5bn. No wonder it looks likely that shares will open higher on Halloween, helping to cement the Cupertino-based business’s valuation above $4trn.
But will this momentum last?
Lagging the pack
Despite all the good news, Apple’s share price has lagged fellow tech giants in 2025 so far. An 11% gain (as I type) is significantly lower than the likes of chipmaker Nvidia (+47%) and Microsoft (+26%). It’s also lower than the S&P 500 has returned as a whole (+16%).
At least some of this might be due to concerns over relatively sluggish business in China and the potential impact of Donald Trump’s off/on/off again tariffs.
What about that ‘AI bubble’?
Of course, the elephant in the room is the view that stock markets are in an AI-induced euphoria. The concern is that the bubble — if indeed it is a bubble — could soon lead to a massive crash in share prices. In such a situation, it doesn’t feel outlandish to say that Apple may be caught up in the trouble.
Looking around, there does seem to be evidence that investors are growing increasingly skittish. Yesterday, shares in Facebook owner Meta dropped by 11% on fears surrounding its plan to increase spending on AI into 2026.
Still, it doesn’t look like Apple’s owners are spooked just yet. The fact that CEO Tim Cook and co have forecast revenue growth of between 10% and 12% for the next (very important) quarter has probably helped. Again, that’s more than analysts had anticipated.
Reasons to be optimistic
But of course, trying to predict the short-term movement of share prices is arguably a complete waste of time. From the Foolish perspective, it’s far better to think about the long-term outlook for our investments.
On this front, I think there are plenty of reasons to stay bullish. Thanks to its massive ecosystem and diversified earnings, it’s far less speculative than other tech names. The Services division is showing solid growth and we shouldn’t forget that this company has an insanely big cash pile too.
If Apple can show evidence of being able to monetise AI in time, I’d say all bets are off.
Here’s what I’m doing
Personally, I’m happy to get my exposure to the company via a globally-diversified tracker. While this won’t protect me from a dip in the wider markets, it should mean I can still sleep at night if the worst of all were to happen. And if history is any guide, we can be pretty sure that a crash will happen at some point.
But if Apple stock were to be ‘thrown out with the bathwater’ and trade at massive discount to its undeniable quality, I might revise my strategy and consider buying direct.
