The supply chain crisis caused the company to lose $6 billion (about Rs 44,890 crore) in sales during the company’s fourth quarter, which missed Wall Street’s expectations, and chief executive Tim Cook said during the current holiday sales quarter. The effect would be worse.
Cook told Reuters on Thursday that there were “more than expected supply constraints” in the quarter ended September 25, as well as manufacturing disruptions related to the pandemic in Southeast Asia. While Apple saw “significant improvements” to those Southeast Asian features by the end of October, chip shortages remain and are now affecting “most of our products,” Cook said.
Cook said, “We are doing everything we can to get more (chips) and we are also doing everything operationally to make sure that we are moving forward as quickly as possible. can.”
Cook said the company expects year-on-year growth in the quarter ending December. Analysts expect it to rise 7.4 per cent to $119.7 billion (about Rs 8,95,413 crore).
“We’re forecasting very solid demand growth year over year. But we’re also predicting that we’re going to fall short of demand by more than $6 billion,” Cook said.
Shares of the California-based company Cupertino, which had risen nearly 15 percent this year, fell 3.4 percent in extended trading Thursday. The fall could make Microsoft the world’s most valuable company, following a rally in Microsoft’s shares on the back of its cloud computing business.
Apple’s results were mixed in the fiscal fourth quarter, which was seen as a lull ahead of the high-sales holiday end of the year.
Apple said revenue and profits for the fiscal fourth quarter stood at $83.4 billion (approximately Rs 6,23,739 crore) and $1.24 (about Rs 92 crore) per share, compared to analysts’ estimates of $84.8 billion (approximately Rs 6,34,241 crore). was. $1.24 per share, according to Refinitiv’s IBES data.
The results were a rocky end to a fiscal year of sales above expectations led by strong sales of its iPhone 12 models and Mac computers and iPads for working and learning from home during the COVID-19 pandemic.
Apple told investors in July that chip shortages would begin to affect its iPhone and iPad lineup for the first time in the fourth quarter.
Apple posted its results shortly after retailer Amazon’s forecast fell short of Wall Street’s expectations, citing labor shortages and global supply chain issues.
Sophie Lund-Yates, Equity said, “Apple has managed to “navigate the problems fairly well, but not completely escape it, and an extended period of these problems will cause trouble, especially when The market is forgiving when it comes to Apple’s performance,” said Hargreaves Lansdowne analyst.
Apple missed expectations in two major categories.
According to Refinitiv data, Apple said that iPhone sales in the fourth quarter stood at $38.9 billion (approximately Rs 2,90,968 crore), lower than estimates of $41.5 billion (approximately Rs 3,10,415 crore).
Cook said chips made with outdated technology continue to be a major supply bottleneck. He said Apple is unsure whether the shortage will ease after the holiday shopping season.
“It’s very difficult to call that,” Cook told Reuters.
The company’s accessories segment, which includes fast-growing categories like its AirPods wireless headphones, came in at $8.8 billion (about Rs 65,837 crore), half a billion dollars less than analysts’ expectation of $9.3 billion (about Rs 69,575 crore). . For Refinitiv data.
Other segments outperformed. According to Refinitiv data, sales of iPads and Macs stood at $8.3 billion (about Rs 65,823 crore) and $9.2 billion (about Rs 68,815 crore), while analysts’ estimates were between $7.2 billion (about Rs 53,855 crore) and $9.2 billion.
The company’s services segment – which includes its App Store business – had sales of $18.3 billion (about Rs 1,36,897 crore), up 26 percent compared to analysts’ expectations of $17.6 billion (about Rs 1,31,661 crore). is more. Cook told Reuters that Apple now has 745 million paid customers on its platform, up from 700 million reported a quarter ago.
Hal Edins, chief economist at Apple Shareholder Capital Investments, said, “The services were strong, and it reflects the beauty and durability of the software and services, with better margins and no supply problems, because the software doesn’t ship containerized.” ” companies.
© Thomson Reuters 2021