Provide chain woes price Apple Inc $6 billion in gross sales throughout the firm’s fiscal fourth quarter, which missed Wall Avenue expectations, and Chief Govt Tim Cook dinner stated that the impression will likely be even worse throughout the present vacation gross sales quarter.
Cook dinner instructed Reuters on Thursday the quarter ended Sept. 25 had “bigger than anticipated provide constraints” in addition to pandemic-related manufacturing disruptions in Southeast Asia. Whereas Apple had seen “important enchancment” by late October in these Southeast Asian amenities, the chip scarcity has persevered and is now affecting “most of our merchandise,” Cook dinner stated.
“We’re doing all the things we are able to do to get extra (chips) and in addition all the things we are able to do operationally to verify we’re transferring simply as quick as attainable,” Cook dinner stated.
Learn extra:
Apple, Alphabet, Microsoft report over $50B in revenue mixed for Q2 2021
Shares of the Cupertino, California-based firm, which had risen almost 15% this 12 months, slumped 5% in prolonged buying and selling on Thursday.
Cook dinner stated the corporate expects year-over-growth for its quarter ending in December. Analysts anticipate progress of seven.4% to $119.7 billion.
“We’re projecting very stable demand progress 12 months over 12 months. However we’re additionally predicting that we’re going to be wanting demand by bigger than $6 billion,” Cook dinner stated.
Apple’s outcomes had been combined in a fiscal fourth quarter seen as a lull earlier than the high-sales vacation finish of 12 months.
Apple stated revenues and income for the fiscal fourth quarter had been $83.4 billion and $1.24 per share, in contrast with analyst estimates of $84.8 billion and $1.24 per share, in accordance with IBES knowledge from Refinitiv.
The outcomes had been a rocky finish to a fiscal 12 months of above-expectations gross sales led by its iPhone 12 fashions and powerful gross sales of Mac computer systems and iPads for working and studying from dwelling throughout the COVID-19 pandemic.
Apple instructed buyers in July that chip constraints would begin to hit its iPhone and iPad lineups for the primary time within the fourth quarter.
Apple posted its outcomes shortly after retailer Amazon.com forecast holiday-quarter gross sales nicely beneath Wall Avenue expectations, citing labor provide shortages and international provide chain points partially.
Misses
Apple missed expectations in two key classes. Apple stated fourth-quarter iPhone gross sales had been $38.9 billion, wanting estimates of $41.5 billion, in accordance with Refinitiv knowledge.
Cook dinner stated that chips made with older expertise stay the important thing provide constraint. He stated that Apple stays uncertain whether or not the shortages will ease after the vacation buying season.
“Most of what we design are modern (chip manufacturing) nodes, however the entire merchandise have some legacy node parts in them as nicely. And in order that (scarcity) continues into (fiscal) Q1, and we’ll see what it seems like past that. It’s very tough to name,” Cook dinner instructed Reuters.
The corporate’s equipment section, which incorporates fast-growing classes like its AirPods wi-fi headphones, got here in at $8.8 billion, half a billion {dollars} decrease than analyst expectations of $9.3 billion, in accordance with Refinitiv knowledge.
Learn extra:
Apple to chop iPhone 13 manufacturing amid provide chain disaster: report
Different segments fared higher. Gross sales for iPads and Macs had been $8.3 billion and $9.2 billion, in contrast with analyst estimates of $7.2 billion and $9.2 billion, in accordance with Refinitiv knowledge.
The corporate’s providers section – which incorporates its App Retailer enterprise – had gross sales of $18.3 billion in income, up 26%, in contrast with analyst expectations of $17.6 billion. Cook dinner instructed Reuters that Apple now has 745 million paid subscribers to its platform, up from the 700 million it disclosed 1 / 4 in the past.
One other vibrant spot within the firm’s outcomes had been its gross sales in China, which had been up 83% to $14.6 billion.
The corporate stated it returned $24 billion to shareholders throughout the quarter.
