Apple stock drops 4% after Q4 report despite record fiscal year

Apple shares declined by approximately 4% in premarket trading on Tuesday following the release of its fourth-quarter earnings. The company reported revenue that exceeded analyst expectations, yet the stock reacted negatively to specific product misses and a cautious outlook on future margins. This trading session marked the first quarterly report issued since John Ternus assumed the role of CEO from Tim Cook in September.

The financial results revealed a mixed performance across product lines. While total revenue grew, sales for the iPad fell short of market estimates. The company attributed the pressure on its bottom line to a global shortage of memory chips and a competition for computer components. Memory costs rose in the current quarter compared to the period ending in June. Despite these rising input costs, Ternus stated that Apple had completed its best fiscal year in its history.

Ternus explained to CNBC's MacKenzie Sigalos that the company's growth was achieved despite supply constraints and unfavorable foreign exchange rates. However, the margin outlook raised concerns among analysts. Violeta Todorova, a senior research analyst at Leverage Shares, identified profitability as the primary worry for investors. She noted that management cited memory costs and the expense of rolling out Siri AI as the main pressures on margins. Todorova added that memory shortages are expected to limit the supply of Mac and iPad units because demand has outpaced planning.

Apple shares have climbed 25% in 2026, outperforming other major technology stocks. Todorova observed that this performance creates a premium valuation that leaves little room for disappointment in future reports. The stock's movement reflects the market's focus on the sustainability of these earnings in the face of supply chain challenges.

Palantir shares also dropped in premarket trading, falling 6.5% on Tuesday. The data analytics firm announced that its third-quarter revenue nearly doubled from the same period last year, surpassing $2 billion for the first time. U.S. commercial revenue exceeded government revenue for the first time during this quarter.

Despite the top-line growth, investors scrutinized the pace of new business. William Blair noted in a Tuesday memo that the growth in total contract value bookings for U.S. commercial customers slowed. A Piper Sandler note from Monday questioned whether the 11% growth in U.S. commercial total contract value bookings was a temporary fluctuation or a structural shift. The firm believes demand for Palantir solutions continues to outstrip supply.

The simultaneous premarket declines for both stocks underscored the current market sensitivity to growth metrics and margin guidance. Traders are weighing the immediate earnings beats against the longer term challenges presented by component costs and booking growth rates.