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AAPL

Amazon, Alphabet, Microsoft, Meta, and Apple Just Reported Earnings. I Think This Was the Best Report of Them All.

May 01, 2026 — 09:52 pm EDT

Written by

Daniel Sparks for

The Motley Fool->

Key Points

- Apple's earnings per share rose 22% year over year in its fiscal second quarter.

- The company's services business accelerated to 16% revenue growth.

- Apple's capital expenditures are minuscule compared to these "Magnificent Seven" peers.

- 10 stocks we like better than Apple ›

This week, five "Magnificent Seven" members -- Amazon (NASDAQ: AMZN), Alphabet (NASDAQ: GOOGL)(NASDAQ: GOOG), Microsoft, Meta Platforms (NASDAQ: META), and Apple (NASDAQ: AAPL) -- reported quarterly results, and the headlines all looked great. Calling out some of the highlights, Meta's revenue jumped 33%, Alphabet's Google Cloud revenue soared 63% year over year, and Amazon's cloud computing business grew at its highest rate in 15 quarters.

But four of these five companies have been spending huge sums of cash to produce this kind of growth. And some of them even used their latest quarterly updates as opportunities to raise their already massive 2026 capital expenditure budgets.

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One of these companies' earnings reports, however, looked much different from the rest: Apple's. The iPhone maker posted accelerating growth without committing enormous spending on AI infrastructure -- and it did this while seeing accelerating growth in its high-margin services business, too.

Here are four reasons why I think Apple was the best report of the bunch -- and the best stock to buy out of the group, too.

Image source: Getty Images.

1. Accelerating revenue growth

Apple's fiscal second quarter of 2026 (the period ended March 28, 2026) revenue of $111.2 billion was up 17% year over year, and earnings per share climbed 22%. Both numbers represented a step up from the prior quarter, when fiscal Q1 revenue grew 16% and earnings per share rose 19%.

And the company's biggest segment -- iPhone -- saw revenue increase 22% year over year to $57 billion, with management calling the iPhone 17 the most popular lineup in Apple's history.

Further, the overall business benefited from strong momentum in the key Greater China market, where revenue jumped 28% to $20.5 billion.

Looking ahead, Apple's strong momentum should persist. The company guided fiscal third-quarter revenue to grow 14% to 17% -- well above the roughly 10% Wall Street had been expecting.

2. This high-margin segment is accelerating

Apple's high-margin services business -- which includes the App Store, Apple TV, Apple Music, Apple Pay, iCloud, AppleCare, and advertising -- has been a core part of the bull case for years. And last quarter, it stepped on the gas.

Apple's fiscal second-quarter services revenue of nearly $31 billion was up 16% year over year -- an acceleration from 14% growth in fiscal Q1 and 13.5% growth across all of fiscal 2025. With services running at a roughly 77% gross margin against about 39% for products, this segment's acceleration significantly bolsters the bull case for Apple stock. In addition, this acceleration is occurring amid the rise of AI services, suggesting the company may be finding ways to benefit from the AI boom.

Feeding its services business, Apple boasts an active installed base topping 2.5 billion devices. And management reaffirmed plans to introduce ads in Apple Maps in the U.S. and Canada this summer -- a small but telling reminder that there are still levers to pull on the services side to further engage and monetize this huge user base.

3. Financial discipline while peers chase AI

Then there's what Apple isn't doing.

Two of the companies that reported this week raised their 2026 capital expenditure plans. Alphabet now expects to spend $180 billion to $190 billion this year, up from a prior range of $175 billion to $185 billion. And Meta lifted its range to $125 billion to $145 billion (from $115 billion to $135 billion). Meanwhile, Microsoft revealed that it expects calendar 2026 capital expenditures to total around $190 billion, and Amazon kept its already huge 2026 plan at roughly $200 billion. Combined, that's well over half a trillion dollars of planned capital expenditures in just one year.

Apple, by contrast, spent only about $13 billion on capital expenditures across all of fiscal 2025, and its capital expenditures for the first two quarters of fiscal 2026 have totaled ju