John Ternus will host his first earnings call as Apple's chief executive on Monday, with investors looking to the company's forecast to determine whether a blitz of new products can help offset surging memory-chip costs.

Ternus, who took over from Tim Cook in September, has presided over the launch of Apple's first foldable iPhone, a smart home hub and the company's first touch-screen laptops. All of those products began shipping during Apple's current fiscal first quarter — a period Cook had described as a "100-year flood" of rising memory costs.

Three issues will draw particular scrutiny: Apple's crucial holiday-quarter outlook, Ternus's remarks on artificial intelligence and the revamped Siri, and climbing memory-chip prices that analysts expect to drag quarterly profit growth to its weakest in six quarters. The memory-cost pressure is not confined to one product: the chips sit inside every iPhone, iPad and Mac Apple sells, which is why analysts view the surge as a drag on hardware margins across the lineup. The stakes in the outlook are amplified by the calendar — Apple's fiscal first quarter runs through late December and is traditionally the company's biggest sales period of the year.

Apple has worked to position its AI offerings differently from rivals such as Meta Platforms' Muse agent, which stormed up App Store rankings in recent weeks. Competitors, including OpenAI — which Apple is suing over alleged trade-secret theft — are also developing devices designed to displace the iPhone as the central gadget in people's lives. How Apple embraces AI could likewise have major implications for its services business, whose slowing growth has unsettled investors after years of rapid expansion. The segment — which includes the App Store — is projected to be Apple's second-largest source of revenue this quarter, behind only the iPhone.

"Recent agentic innovation far outpaces our experience with Siri AI, but Apple has acknowledged that Siri AI … is far more focused on trust/privacy," said Dan Morgan, a portfolio manager at Synovus Trust, which owns Apple shares.

Apple markets its AI systems toward "everyday people" rather than Silicon Valley insiders, who are heavy users of frontier AI models from the likes of OpenAI. Morgan added that investors want to know whether Apple can profit by distributing third-party AI agents through its App Store and taking a cut of the business they generate.

Shares Outperform

For now, Apple's reluctance to join the industry's massive AI spending race has worked in its favor. Its shares have climbed roughly 27% this year, outperforming tech heavyweights including Microsoft, Alphabet, Meta and Amazon as investors seek shelter from mounting concerns over the cost of building AI infrastructure.

Analysts expect Apple to post a nearly 11% rise in revenue to $113.39 billion for the July–September period — its fiscal fourth quarter — according to LSEG data, with net profit forecast to rise about 6% to $29.04 billion.

The services business is expected to grow almost 10% to $31.56 billion, its slowest pace in more than three years. iPhone sales are projected to climb about 15% to $56.54 billion, decelerating from roughly 22% growth in the previous three months.

The results will capture just nine days of sales for the new iPhone 18 Pro models, while the iPhone Duo — Apple's first foldable — launched on October 23, a release that will benefit the holiday quarter.

Foldable Demand Outstrips Supply

Commentary on how the Duo is selling will be closely watched after some buyers of the device, which starts at $1,999 in the US, reported cracks and lines along the inner display's central fold, prompting Apple to offer replacements. Online orders for the Duo sold out within minutes.

IDC analyst Nabila Popal said she expects demand for the Duo to keep exceeding supply despite the screen problems. The test, she said, will be how quickly Apple can replace affected devices while supplies remain tight.

Bank of America estimates Duo buyers face average delivery waits of 79 days, with shipments stretching into January. Because Apple's fiscal first quarter closes at the end of December, that timeline leaves a portion of early Duo demand to be counted in the fiscal second quarter, extending scrutiny of the foldable beyond the holiday period.

— Reuters