Apple expects choppy waters ahead for the quarter that ends in September, the company said on its June quarter earnings call. Apple’s Chief Financial Officer Kevan Parekh warned that supply constraints for advanced chip manufacturing will “increase significantly.” #Gadgets
The company experienced such constraints during the June quarter for Macs, and to a lesser extent iPhones and iPads, due largely to a limited supply of its processing chips. Nvidia chips for artificial intelligence have been soaking up more and more of the chip making capacity of Taiwan Semiconductor Manufacturing Company, Apple’s primary chip manufacturing partner.
For the June quarter, Apple reported sales of $109.4 billion, up 16.4% from the prior year, and a net income of $29.8 billion, advancing 27% annually. The iPhone grew nearly 22% to $54.3 billion in sales.
The company said it expects revenue to increase between 9% and 11% in the September quarter from the year earlier period, while it expects iPhone growth to slow to the mid-teens as supply constraints grow. Apple fell more than 7% in after-hours trading following the guidance announcement.
While many stocks are getting hit hard this week over concerns with heavy AI spending, Apple has stood apart from the pack by limiting its capital expenditures on AI. The company’s stock was up 23% so far this year prior to its earnings announcement, outperforming most of its tech peers.
On the call, CEO Tim Cook noted that he will soon hand off the top job at the company to John Ternus, its current hardware leader, who will replace Cook in September. “This will be my final earnings call, and John will lead these calls going forward,” Cook said. “The transition is going seamlessly, and I am beyond excited for John to step into his new role and lead Apple into its next era.”
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