Apple has posted record quarterly profits, driven by surging iPhone demand and a strong rebound in China, signalling the tech giant has weathered recent trade tensions and tariff challenges.

The company reported revenue of US$143.8 billion (A$204 billion) for the three months to December 31, a 16% increase on the same period last year, with earnings per share rising 19% to US$2.84 – well above analyst expectations.

iPhone sales led the growth, generating US$85.3 billion, up 23% year-on-year.

The launch of the iPhone 17 line-up, particularly the premium Pro models, triggered one of Apple’s largest upgrade cycles in years.

CEO Tim Cook described it as “the best iPhone quarter in history,” with sales hitting new highs in every region and the global installed base climbing past 2.5 billion active devices.

China also proved a key driver of the turnaround.

Sales in Greater China jumped 38% to US$25.5 billion, easing concerns about waning demand in the region and highlighting Apple’s enduring brand loyalty despite geopolitical pressures.

Analysts say the recent US tariff relief and strategic price positioning helped offset rising component costs.

However, other product lines were less robust. Mac sales dipped 7%, while wearables and accessories fell about 3%. The iPhone Air, a mid-range model, struggled to gain traction in its first quarter.

Beyond hardware, Apple is making a major push into AI. The company confirmed a multiyear partnership with Google to integrate Gemini AI models into future Siri updates and iPhone features, alongside its acquisition of Israeli start-up Q.ai to enhance voice and speech technology.