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Apple shares slide as higher memory costs fuel margin concerns
- Apple reported fiscal fourth-quarter earnings on Monday, forecasting gross margin to drop to 45% to 46% in December as rising memory costs pressure profitability.
- Inventory surged 154.3% year-over-year to $14.5 billion in the quarter, driven by aggressive stockpiling of memory components before prices rise further.
- Apple CEO John Ternus called current memory pricing "unprecedented," noting that benefits from lower-cost inventory stockpiles are "decreasing" as costs continue climbing.
- IPad revenue reached $6.2 billion, missing analyst expectations of $6.7 billion and declining 10% year-over-year despite price increases implemented earlier this year.
- COO Sabih Khan and CFO Kevan Parekh emphasized that memory costs will continue rising beyond December, with the company carefully balancing short-term and long-term considerations.
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Apple expects its highest revenue yet in Q4, but memory prices will hurt profits
During an earnings call on November 2, the company's CFO Kevan Parekh said that Apple is expecting Q4 this year to be the best quarter in the history of the company in terms of revenue. The fiscal Q4 2026 (ending in September) results point to a very optimistic near future for the company, despite the supply chain constraints, rising component prices and inventory shortages. The forecast comes amid Apple's record-breaking numbers reported in Q3 …
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Total News Sources50
Leaning Left2Leaning Right1Center15Last UpdatedBias Distribution83% Center
Bias Distribution
- 83% of the sources are Center
83% Center
11%
C 83%
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