Apple reported record-breaking sales in its latest quarter with revenue reaching $111.2 billion – a figure bolstered by strong iPhone demand. However, CEO Tim Cook issued an ominous warning: the chip shortage could soon hit Apple hard.
The memory chip market is facing unprecedented pressures, driven by the AI boom which has led to ‘RAMageddon’ – a term that aptly describes the surging prices of hardware components. This poses a significant challenge for Apple, primarily a hardware company, as Cook admitted they spent more on chips in their March quarter than before.
Apple’s ability to sell off stockpiled inventory helped offset these costs, but Cook foresees an increasing impact from higher memory chip prices starting June onwards. The iPhone line may not be spared: reports indicate RAM costs have quadrupled, driving up production expenses for the device.
New CEO John Ternus, who has served as Apple’s senior vice president of hardware engineering, aims to capitalize on Cook’s extensive supply chain experience but faces a daunting task ahead. As executive chairman, Cook will provide critical guidance amid these turbulent times for the tech giant.
