Apple warned on Thursday that it would likely take a "significant" hit from expected supply constraints for some of its popular products, even as it reported stronger-than-expected results for the quarter. Shares in the company fell in after-hours trading by more than 7%, while Apple said revenue rose 16% to $109b (£81b) and profits increased 26% to $29b.
Outgoing chief executive Tim Cook said supply constraints had already appeared this year in the availability of Mac computers and were expected to worsen. He said the problem would also spread to iPhone and iPad products.
"We're seeing some very significant constraints currently with limited flexibility in the supply chain to remedy it,"
Apple said one of the supply constraints involved key chip components used in its products. Devices such as Macs and iPhones require microprocessors with "advanced nodes" - computer chip technology that allows them to operate more quickly - most of which Apple has manufactured through TSMC, which is based in Taiwan.
Cook said the core issue was unexpected demand, mainly for iPhone and Mac products. Sales of those products grew 22% and 25% respectively during the June quarter.
Earlier this year, Apple said its iPhone 17 was so in demand that its launch was the biggest in the company's history.
"This is not a regular supply issue, it's a demand forecast issue to be candid,"
"We've got a quarter ahead where we'll be scrambling on the supply side."
Apple also said its gross margin, or the amount of money it keeps from every sale, was 2% larger than it otherwise would have been during the last three months because of tariff refunds. Based on BBC calculations, that would mean Apple received roughly $1.1b in such refunds.
Cook said Apple intended to
"reinvest the tariff refunds into the US". The company previously said it intended to put $600b toward building out more domestic manufacturing over the next four years. China is currently the largest manufacturer of Apple's products.
Cook also addressed Apple's impending public relaunch of Siri, the AI assistant that the company has struggled to make competitive in an era of proliferating AI chatbots from the likes of OpenAI and Anthropic.
While the new version of Siri AI is still in public beta, essentially a testing phase before broader release, Cook said it is part of
"an enormous opportunity for Apple going forward in AI."
"The ability to run on device is also very strategic, and sort of a competitive weapon, if you will,"
He added that negotiations with authorities in the European Union about releasing the new version of Siri are ongoing, with the goal of making it available
"to everyone, everywhere at the same time."
