Reuters : Apple (AAPL.O), opens new tab forecast sales for the current quarter ending in September would grow more slowly than Wall Street targeted as the iPhone maker struggled to get the parts it needed to deliver products, and shares fell 5.5% in after-hours trade.
Apple and the technology industry generally have been scrambling to meet demand for new products, especially those with high-end processors and memory, and executives described the weaker forecast in terms of supply, not demand.”We’re seeing some very significant (supply) constraints currently with limited flexibility in the supply chain to remedy it,” Chief Executive Tim Cook said during the call, adding that Apple was “evaluating all options” for alternative suppliers of memory chips.
Chief Financial Officer Kevan Parekh told analysts on a call that Apple expects revenue growth of 9% to 11% in the quarter compared with a year earlier. That was less than the 12% rise predicted by Wall Street, according to LSEG data. He forecast iPhone revenue would grow at a mid-teens rate, compared with Wall Street’s target of 17.6%, and that gross profit margins would be between 47% and 48%.In an interview with Reuters, Cook said the main supply constraint in the just-ended fiscal third quarter was an industry shortage of advanced chipmaking technology used to produce the Apple silicon chips at the heart of its devices. That was particularly true for the Mac lineup, whose sales grew 29% on the strength of the entry-level MacBook Neo and the high-end MacBook Pro despite price increases.
“If you look at the root causes behind those, it’s that we’re having an incredibly strong product cycle beyond our expectations, and the (advanced chipmaking) supply chain just fundamentally has less flexibility in it to meet the high levels of demand,” Cook told Reuters.
