Apple warns memory chip prices will keep rising, inventory hits $14.5 billion
The iPhone maker says costs will hit its margins, and it did not say whether more price rises are coming.
Key facts
Story- Apple warned investors that memory chip prices are rising at an unprecedented rate.
- Its inventory climbed to $14.5 billion, up 154%, according to one report.
- Apple said recent price increases have offset some of the cost impact.
Apple has warned that memory chip prices are rising at an "unprecedented" pace. The iPhone maker said the increase will squeeze its profit margins, and its shares dropped in after-hours trading on Monday.
The company said it is competing with data centres to secure enough memory chips. Its inventory has grown to $14.5 billion, a rise of 154%. Apple's revenue was stronger than analysts had expected, the company said.
Apple said its decision to raise device prices has offset part of the higher chip costs. During the earnings call, executives said they were weighing margins against further price increases. Asked directly whether another price hike was coming, the company's chief operating officer did not answer the question.
The company expects higher memory costs to hit its iPhones, MacBooks and iPads. Apple has not said by how much.
Apple has not announced any specific price changes for India or other markets.
Apple has not said when any further price changes might take effect. It has also not given figures for how much the chip costs have risen.
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