Goldman Sachs Maintains Buy on Apple: Near-Term Guidance Under Pressure, but Ecosystem and Services Resilience Support Valuation

Overview

This report reviews Apple Inc.'s F3Q26 results from Goldman Sachs. The report notes that Apple's quarterly revenue and underlying EPS were broadly near expectations, with product revenue supported by strong iPhone and Mac demand, but F4Q26 guidance was below market expectations, mainly due to supply constraints, rising memory costs, and currency headwinds. Although the share price may face near-term pressure, Goldman Sachs maintains its Buy rating and believes that Apple's ecosystem, Services business, and new product innovation continue to provide medium-term support.

Core views

The core views include: first, F3Q26 results themselves were not materially disappointing, with EPS and underlying gross margin broadly in line with expectations; second, F4Q26 revenue and gross margin guidance were the primary negative factors, with supply constraints creating an approximately 350-basis-point year-over-year revenue headwind and currency creating an approximately 150-basis-point year-over-year headwind; third, demand for the iPhone 17 series, Mac upgrades, and increased enterprise/education market share indicate that product momentum remains strong; fourth, Services is facing short-term pressure from currency effects and a slowdown in the App Store, but iCloud+, AppleCare+, and ecosystem attachment rates can continue to support long-term growth; fifth, valuation remains attractive relative to historical levels and large-cap technology peers.

Analysis framework

The report compares reported results with Goldman Sachs forecasts and market consensus expectations, focusing on revenue segments, gross margin, EPS, expenses, buybacks, and F4Q26 management guidance, and uses these factors to adjust F2026-F2028 earnings forecasts and the target price. For valuation, Goldman Sachs derives the 12-month target price using an unchanged 37x NTM+1Y EPS multiple.

Methodology notes

• Valuation methodsNTM+1Y EPS multiple

  P/E multiple valuation

  Goldman Sachs maintains the NTM+1Y EPS valuation multiple at 37x; due to lower earnings forecasts, it lowers the 12-month target price from $370 to $360.

• factor_analysisGS Factor Profile

  Goldman Sachs factor profile

  The report discloses that GS Factor Profile uses growth, financial returns, valuation multiples, and composite factors to compare stocks with the broader market and industry peers.

• scenario_or_risk_frameworkM&A Rank

  M&A probability framework

  Goldman Sachs discloses that its globally covered stocks are assigned an M&A Rank from 1 to 3 to assess the potential probability of being acquired, but the report does not indicate that this factor makes a core contribution to Apple's target price.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• AAPL.US

  Research subject; Goldman Sachs maintains its Buy rating

  Strengths

  Strong brand and high user loyalty, a large installed base, strong iPhone 17 and Mac demand, long-term Services growth, strong buyback capacity, and attractive valuation relative to historical levels and technology peers.

  Weaknesses

  F4Q26 revenue and gross margin guidance below expectations, slowing Services growth, weaker-than-expected iPad revenue, and memory costs and supply constraints weighing on margins.

  Comparison

  F3Q26 revenue was above market consensus but below Goldman Sachs' forecast; iPhone and Mac revenue were above market expectations, while Services and iPad were below expectations.

  Risks

  Weakening consumer demand, supply chain disruptions, intensifying competition, regulatory risks, and capital allocation execution risks.

Key data

• 12-month target price$360.00Previous value was $370; based on a 37x NTM+1Y EPS multiple.
• Current price$333.43Price disclosed on the report cover.
• Implied upside8.0%Based on the target price and current price disclosed in the report.
• F3Q26 EPS$2.02; $1.91 excluding the tariff refundUnderlying EPS was broadly in line with Goldman Sachs' $1.93 and the market's $1.89.
• F3Q26 revenue$109.4bnBelow Goldman Sachs' $110.1bn and above the market's $109.0bn.
• F3Q26 product revenue$78.7bnIn line with Goldman Sachs' forecast and above the market's $77.6bn.
• F3Q26 Services revenue$30.7bn, up 12% year over yearBelow Goldman Sachs' and market consensus expectation of $31.4bn.
• F3Q26 gross margin50.1%; 48.1% on an underlying basisUnderlying gross margin was broadly in line with Goldman Sachs' 48.2% and the market's 48.1%.
• F4Q26 revenue guidance9%-11% year-over-year growthBelow the market expectation of approximately 12%.
• F4Q26 gross margin guidance47%-48%; approximately 46%-47% excluding the tariff refundHigher memory costs are driving a sequential decline.
• F2026-F2028 EPS adjustmentLowered by approximately 4% on averageReflects weaker F4Q26 guidance and margin pressure related to supply constraints.
• F2026E revenue$479.4bnGoldman Sachs' new forecast in the report table.
• F2026E EPS$8.91Goldman Sachs' new forecast in the report table.

Impact & implications

In the short term, below-expectation F4Q26 guidance could pressure the share price and market sentiment, particularly as gross margin is affected by rising memory costs and Services revenue is weighed down by currency effects. In the medium term, Apple may still mitigate cyclical pressure through premium product pricing/mix, Mac and iPhone upgrade demand, increased enterprise and education market share, Siri AI, and improved Services attachment rates. Goldman Sachs' maintained Buy rating indicates that it believes the market is overly focused on slowing product revenue while underestimating the revenue visibility and Services profit contribution provided by the ecosystem.

Risks

• Weakening consumer demand could affect product and Services sales, particularly iPhone upgrade demand.
• Supply chain disruptions and geopolitical tensions could affect global trade, tariffs, and the supply of key components.
• Increasing competition in personal devices and Services could weaken growth and margins.
• Greater regulatory scrutiny in key markets could weaken Apple's proprietary ecosystem and competitive advantages.
• Capital allocation activities such as M&A and share buybacks may generate lower-than-expected returns or face stricter regulation.
• Continued increases in memory costs, constrained supply of advanced-process SoCs, and currency headwinds could further compress F4Q26 and subsequent margins.

What to watch

• Whether F4Q26 revenue growth falls within the 9%-11% guidance range and the pace of supply constraint relief.
• The ongoing impact of memory costs on gross margin, and whether cost reductions in non-memory components and inventory carryover can offset the pressure.
• The sustainability of demand for the iPhone 17 series, MacBook Neo, and Mac Mini.
• Whether Services revenue growth can stabilize after currency headwinds and App Store pressure.
• Global approval and rollout progress for Siri AI, particularly potential delays in China and Europe.
• The impact of price increases for Mac, iPad, and future iPhones on revenue, product mix, and volume elasticity.