# Apple Warns of Unprecedented Memory Chip Price Hikes Rising component costs threaten profit margins despite strong revenue growth and iPhone sales. - **Source:** [Technology | The Guardian](https://www.theguardian.com/uk/technology) - **Published:** 2026-11-03 - **Topic:** [Business](https://brifing.si/c/business) - **Original article:** - **On Brifing:** https://brifing.si/s/3e290bf9-95cd-4104-bda9-2efff2ee6b8b ## Unprecedented Memory Cost Surge Apple CEO John Ternus recently identified an unprecedented rise in memory chip pricing during a conference call. This volatility stems from intense competition with AI datacentres for limited global supplies. Ternus explicitly warned investors that these elevated costs are expected to climb further throughout the fourth quarter, creating significant pressure on margins. ## Mitigation Through Price Adjustments To counteract the impact of rising component costs, Apple implemented strategic price increases across its hardware lineup. The company raised prices for iPads and MacBooks in June, followed by iPhone adjustments in September. These tactical moves provided a partial offset to the financial strain, helping maintain revenue stability during this period. ## Strong Revenue Performance Despite the supply chain headwinds, Apple reported a 12% increase in revenue, reaching $30.71 billion for the July-September period. This performance exceeded analyst expectations of $1.99 per share, landing at $2.10. The growth was primarily fueled by robust iPhone sales and solid demand for the Mac Mini, which supports agentic AI. ## Market Reaction and Shares Following the disclosure of these cost pressures, Apple shares fell 2.75% in after-hours trading on Wall Street. While the revenue figures were stronger than anticipated, investors reacted cautiously to the warnings regarding profit margins. This decline reflects broader market sensitivity to the rising costs of hardware components within the tech sector. ## Regional and Product Insights Growth in China remained robust, providing a positive signal for the company's international performance. Conversely, the iPad and wearables segments underperformed, showing growth below the group average of 10%. Analysts are currently monitoring the early reception of the iPhone Duo, hoping it will catalyze the next phase of Apple's product innovation. ## AI Infrastructure Strategy Apple maintains a distinct approach to AI infrastructure compared to industry peers like Alphabet and Amazon. By adopting a more tepid spending strategy, the company has successfully preserved its cashflow. Furthermore, strategic partnerships allow Apple to enhance its AI capabilities without assuming the heavy financial risks currently impacting other major technology firms. ## Comparative Financial Context Apple's fiscal results stood out against a downward trend observed among other tech giants this quarter. While companies like Intel and Amazon faced disappointing quarterly outcomes, Apple’s resilience was highlighted by record iPhone revenue. The inclusion of five cents per share from tariff refunds also contributed to the final earnings reported for the period. ## Future Outlook and Challenges The tech industry continues to grapple with the phenomenon known as RAMageddon, driven by insatiable demand from AI datacentres. As Apple navigates this supply crunch, the focus remains on balancing hardware innovation with margin protection. Investors will be watching closely to see if current price offsets remain sufficient against ongoing component inflation. ## Sources covering this story - https://www.theguardian.com/technology/2026/nov/02/apple-third-quarter-revenue-earnings — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._