Apple beat quarterly expectations, but a weaker-than-expected forecast and ongoing chip shortages rattled investors.
Apple delivered another strong quarter, driven by booming iPhone and Mac sales, but investors focused on what comes next. The company warned that supply chain bottlenecks will slow revenue growth in the current quarter, sending its shares lower in after-hours trading.
KEY DETAILS
Apple expects September-quarter revenue to grow between 9% and 11%, below Wall Street's forecast of 12%. CFO Kevan Parekh also projected iPhone revenue growth in the mid-teens, short of analysts' 17.6% estimate.
CEO Tim Cook said the biggest challenge remains a shortage of advanced chipmaking capacity, limiting Apple's ability to meet demand. He said the company is exploring alternative memory chip suppliers as it works through supply constraints.
For the fiscal third quarter ended June 27, Apple reported revenue of $109.42 billion, up 16.4% from a year earlier and ahead of expectations. Earnings reached $2.02 per share, including 11 cents from U.S. tariff refunds. Even without those refunds, profit topped the $1.89 analysts expected.
iPhone revenue jumped 21.7% to $54.25 billion, beating estimates of $53.86 billion and marking Apple's strongest third-quarter iPhone sales on record. Mac revenue climbed 28.7% to $10.35 billion, well above forecasts, while iPad sales slipped 5.9% to $6.19 billion.
Services revenue rose 12.1% to $30.74 billion, missing the $31.22 billion estimate as App Store gaming revenue faced pressure and regulatory changes weighed on growth.
MARKET REACTION
Apple shares fell 5.5% in after-hours trading as investors reacted to the softer outlook. Concerns also grew that recent demand may have been boosted by customers buying ahead of potential future price increases.
WHY IT MATTERS
Apple's results show consumer demand remains strong, but supply constraints and slowing services growth could influence the stock in the months ahead. Traders will also be watching for any iPhone price changes during Apple's September product launch.
The next major test for Apple will be whether it can ease supply shortages while keeping demand strong for its upcoming iPhone lineup. Investors will also be looking closely at services growth and margins as the company heads into its busiest product season.
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Source: Reuters
Time: 10:00 AM EEST
