Apple's iPhone sales lift stock, but global memory shortage and supply constraints to hit margins

May 1, 2026 - 20:58

Apple shares climbed on Thursday after the company reported better-than-expected quarterly earnings, driven by robust iPhone sales. However, the tech giant warned that global memory chip shortages and ongoing supply chain disruptions will squeeze profit margins in the near term.

The Cupertino-based company posted revenue of $89.5 billion for the fiscal fourth quarter, beating analyst estimates. iPhone revenue alone reached $42.6 billion, a 10% increase from the same period last year, fueled by strong demand for the iPhone 15 lineup. Services revenue also grew, hitting $22.3 billion.

Despite the upbeat numbers, Apple's finance chief Luca Maestri told investors that the company expects a "sequential decline" in gross margins during the holiday quarter. He cited higher costs for components, particularly memory chips, and logistics expenses. The global semiconductor shortage has been a persistent headache for electronics makers, but Apple had previously managed to navigate it better than rivals. Now, the tight supply of DRAM and NAND flash memory is adding pressure.

Analysts noted that Apple's ability to pass on costs to consumers may be limited, especially in a cautious spending environment. The company also faces headwinds from a strong U.S. dollar, which reduces the value of overseas sales. While the stock rose in after-hours trading, the margin warning tempered some of the enthusiasm. Investors will watch closely for how Apple manages these constraints in the coming months.