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Apple Warns of Chip Shortage, Shares Fall 7%

businessAug 2, 2026·372 words·3 min read

Apple warned on Thursday that tightening supply would take a serious toll on its current quarter, sending its shares sharply lower despite a strong quarterly performance. Chief executive Tim Cook told investors the company was facing what he called a "100-year flood" in memory-chip pricing that is squeezing profit margins. The warning overshadowed results that beat expectations: revenue rose 16 percent to $109.4 billion and profits climbed 26 percent to about $29 billion, with June-quarter iPhone sales reaching a record $54.25 billion.

Cook said the real problem is that Apple did not expect so many people to buy its new products. Sales of the iPhone grew 22 percent and sales of Mac computers grew 25 percent. Some Mac computers are already hard to find. Apple thinks the iPhone and iPad will be next.

Apple also told investors that sales will grow 9 to 11 percent in the next quarter. Experts had hoped for about 12 percent. Only days before, the value of the company passed $5 trillion for a short time. This was Cook's last report as head of Apple. John Ternus will take his job on 1 September.

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