Apple warned of an "unprecedented" rise in memory chip prices as it competes with datacentres for supplies, according to The Guardian. The iPhone maker's shares fell in after-hours trading after it told investors that the higher prices will eat into its profit margins.
John Ternus, Apple's new chief executive, told a conference call on Monday that memory pricing was "unprecedented" and predicted that memory costs in the fourth quarter of this year would be even higher than in the previous three months. The industry has been gripped for months by what has been called "RAMageddon", as demand for memory chips from AI datacentres has surged, driving up prices.
Ternus said Apple's decision to raise iPad and MacBook prices in June, followed by iPhone prices in September, had "provided some offset" for the company. Apple's shares were down 2.75% in after-hours trading on Wall Street.
The company posted stronger-than-expected revenue in its fiscal third quarter, giving Ternus an upbeat start to a tenure that began in September. Apple earned $30.71bn, or $2.10 a share, up 12% from $27.47bn, or $1.85 a share, a year earlier, and said earnings included five cents a share from tariff refunds. Analysts polled by FactSet had expected $1.99 a share on revenue of $113.4bn.