Apple caught off guard by AI-fueled Mac demand surge

Apple's iPhone sales and Services revenue took center stage in the tech giant's latest quarterly report, but the Mac quietly delivered a standout performance, buoyed by rising demand for AI processing.

Wall Street analysts had projected Mac revenue to land in the lower $8 billion range. Apple, however, reported $8.4 billion for the second quarter ending March 28—a significant outperformance for a non-core segment of its business. Furthermore, while pre-earnings sentiment suggested Mac sales would remain flat year-over-year, the company reported a 6% annual increase. Apple's total revenue reached $111.2 billion, marking a 17% rise from the same period last year.

Apple credited part of the Mac's growth to recent product launches, including the well-received MacBook Neo. However, these vibrant, colorful computers were only available for a few weeks after preorders began on March 4. In reality, most shipments occurred from mid- to late March, with some demand likely pushed into April as specific models sold out.

On Thursday's Q2 earnings call, Apple CEO Tim Cook told analysts that customer demand for the Neo was "off the charts" and exceeded the company's expectations. He also noted Apple achieved a quarterly record for first-time Mac buyers, partly driven by the Neo.

Cook linked the sales growth to the Mac's role in running local AI models, such as OpenClaw—a trend that somewhat surprised Apple as Mac mini and Mac Studio devices sold out in recent weeks.

"Both are exceptional platforms for AI and agentic tools, and customer recognition of this is accelerating faster than we predicted, leading to higher-than-anticipated demand," Cook said regarding these Mac sales. He added that the Mac mini became the top-selling desktop in China, a market recently caught in an OpenClaw frenzy.

Nevertheless, Mac revenue remained flat quarter-over-quarter, indicating this new demand wave has yet to reach full scale. Cook stated it might take Apple "several months" to achieve a supply-demand balance for the Mac mini and Studio models.

"We're not at a point where we can say this [constraint] will end soon. It's not due to a production issue per se, but rather because we underestimated the demand," Cook explained.

Enterprise demand for the Mac also contributed. Apple highlighted several major companies, including Perplexity, that have adopted the Mac as their preferred platform for developing enterprise-grade AI assistants.

Cook also mentioned Apple was "supply constrained on the MacBook Neo," noting that even school districts, such as Kansas City Public Schools, are switching from Chromebooks to the Neo.