Apple lowers its guidance over the memory chip shortage

Apple expects more subdued sales growth and pressure on margins in the coming months. Behind this lie difficulties in the technology supply chain, linked to the boom in infrastructure for artificial intelligence.

The bottleneck concerns memory chips in particular. Chief financial officer Kevan Parekh indicated revenue growth of between 9% and 11%, below the 12% Wall Street had been expecting.

During the results presentation Tim Cook warned investors that the impact of reduced supply chain flexibility would increase significantly.

Three suppliers for the memory

Cook highlighted the group's dependence on just three suppliers of high-end DRAM memory. They are Micron, in the United States, and SK Hynix and Samsung, in South Korea. According to Cook, the entry of a further supplier would have helped.

The concentration of supply explains why demand generated by AI data centres feeds through to consumer products. The same memory serves both servers and devices, and whoever pays more secures the deliveries.

The effect on prices had already been visible. In June Apple raised list prices for MacBook and iPad by 20%, citing the shortage of memory chips.

The group's financial position nonetheless remains solid. Apple has regained the title of the world's most valuable company, with a market capitalisation of five thousand billion dollars.

This is the last quarterly set of figures presented by Tim Cook before he steps down from leading the company in September. The handover therefore comes at a point where the main constraint is not demand but access to components.

The group has not said how long it expects the pressure on memory to last, nor whether further price adjustments are planned. Nor has it specified whether the price increase decided in June will be extended to other product lines.