NEW YORK, July 25, 2026, 14:10 EDT
- Apple finished Friday at $333.02, gaining 3.53%. The Nasdaq dropped 0.64%.
- Apple reported free cash flow of $78.3 billion over the last six months. In comparison, Alphabet Inc. NASDAQ:GOOGL posted $4.3 billion during the same period.
- Analysts surveyed by Visible Alpha project quarterly revenue of $108.1 billion. Apple is scheduled to announce results on Thursday.
Apple Inc. NASDAQ:AAPL rose 3.53% on Friday, closing at $333.02. The Nasdaq Composite dropped 0.64%. U.S. markets did not open on Saturday.
The surge boosted market value by about $167 billion at current capitalization. Despite this, Apple finished the week down 0.2%.
This outperformed the Nasdaq’s 2.0% decline for the week. Technology stocks slid as investors evaluated the increasing costs associated with artificial-intelligence infrastructure.
Shares of Alphabet Inc. NASDAQ:GOOGL dropped 7% on Thursday as the company increased its planned expenditures and disclosed a negative free cash flow for the quarter.
Apple’s strong performance on Friday indicates that investors might be distinguishing between AI involvement and capital requirements. Company filings provide supporting evidence.
Both companies reported comparable operating cash flow over their most recent half-year periods. However, their post-capex outcomes diverged significantly.
| Latest reported six-month period | Apple, ended March 28 | Alphabet, ended June 30 |
|---|---|---|
| Total revenue | $254.94 billion | $229.69 billion |
| Operating cash flow | $82.63 billion | $84.86 billion |
| Capital spending | $4.34 billion | $80.60 billion |
| Free cash flow* | $78.28 billion | $4.26 billion |
| Capital expenditure as percentage of revenue | 1.7% | 35.1% |
Free cash flow is defined as operating cash flow minus capital expenditure. Reporting periods vary; ratios derive from company disclosures.
Apple turned 94.7% of its operating cash into free cash flow, while Alphabet achieved a 5.0% conversion rate.
Alphabet’s capital expenditures represented 35.1% of its revenue, while Apple’s figure stood at 1.7%. This drove a free-cash-flow difference between the two of 18.4 times.
Peter Andersen, chief executive of Andersen Capital Management, referred to what he called a “fear of massive overbuilding.” Reuters
Apple’s challenge now is growth. Visible Alpha’s initial consensus expects revenue for the fiscal third quarter to reach $108.1 billion, reflecting a 15.0% increase from the prior year.
Initial figures show iPhone sales reached $53.0 billion, a rise of 18.9%. Services revenue is projected at $31.4 billion, marking a 14.5% increase. The gross margin for Services stands at over 70%.
The combination is able to fuel cash production without the need for hyperscale capital expenditures. Still, shares ended Friday just 1.2% under Visible Alpha’s $337 price target. The consensus multiple for 2027 stands at 34 times earnings.
Apple is scheduled to report results Thursday at 5 p.m. EDT. The Federal Reserve is set to meet on Tuesday and Wednesday. As of late Friday, futures indicated a 38% probability of a 25-basis-point rate hike.
Risks: The analysis relies on varying fiscal periods and omits non-capex expenses for AI. Early estimates may turn out elevated. An unexpected move by the Fed might weigh on Apple’s premium valuation.
Apple stands out now for its capital efficiency rather than for having a low stock price. On Thursday, it must demonstrate that minimal infrastructure costs can still drive robust growth.
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