Apple said that a global chip shortage that has bit into its ability to sell Mac and iPad units will start to affect iPhone production and forecasted slowing revenue growth, sending its shares lower.
Apple said on Tuesday that a global chip shortage that has bit into its ability to sell Macs and iPads will start to affect iPhone production and forecasted slowing revenue growth, sending its shares lower. Apple executives said revenue for the current fiscal fourth quarter will grow by double-digits but be below the 36.4 percent growth rate in the just-ended third quarter. Growth will also slow in Apple’s closely watched services business, they said. In a conference call with investors, Apple executives also said that while the impact of the chip shortage was less severe than feared in the third quarter, it will get worse in the fourth, extending to iPhone production. Shares of Apple, whose valuation has more than doubled in about three years to nearly $2.5 trillion (roughly Rs.1,85,89,882 crores), were down 1.7 percent to $144.24 (roughly Rs.10,725) in after-hours trading after the call. Earlier in the day, Apple reported third-quarter sales and profits that beat analyst expectations as consumers bought premium versions of its 5G iPhones and signed up for its subscription services. China sales grew 58 percent to $14.76 billion (roughly Rs.1,09,754 crores) in the quarter, which ended June 26. Driven by the better-than-expected iPhone sales, total revenue hit $81.43 billion (roughly Rs.6,05,478 crores), above analyst expectations of $73.30 billion (roughly Rs.5,45,085 crores), according to IBES data from Refinitiv. Apple’s profits were $21.74 billion (roughly Rs.1,61,666 crores), or $1.30 (roughly Rs.97) per share, above estimates of $1.01 (roughly Rs.75) per share, according to Refinitiv. During the investor call, Chief Executive Tim Cook said that chips affected by the shortages are made with older technology but are still needed as supporting parts to make the company’s flagship device, the iPhone.
