Apple warns chip shortage will limit iPhone, Mac production

Apple reported record-breaking quarterly results but warned that severe supply constraints for critical memory chips will likely hinder production and sales of iPhones and Macs in the coming months, sending its stock lower. The announcement came on July 30 as outgoing Chief Executive Tim Cook led his final earnings call before transitioning to executive chairman on September 1.

For the quarter ended June 30, Apple's revenue rose 16% year-over-year to $109.4 billion, with net income reaching $29.8 billion. The performance was driven by strong demand for iPhones, with sales surging 22%, and Mac computers, where sales grew 29%. Despite these results, the company's shares fell approximately 6% in after-hours trading as executives issued a weaker-than-expected forecast.

Apple anticipates revenue growth of only 9% to 11% for the current quarter, below analyst expectations of 12% growth. The company said iPhone revenue growth is expected to decelerate to a mid-teens percentage rate. Executives attributed the cautious outlook primarily to a global shortage of memory chips, which Cook described as a "hundred-year flood" in pricing and availability.

The chip crunch, driven in part by...