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Rising Memory Costs Pose Early Challenge For New Apple CEO John Ternus

Ternus described current memory pricing as unprecedented and warned that procurement costs could rise further

,   and  TIPP Staff
2 min read
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Apple's new CEO John Ternus faces mounting cost pressures as a global memory shortage threatens the company's profit margins, despite stronger-than-expected quarterly results.

Apple forecast gross margins of 45% to 46% for the December quarter, below analysts' expectations, citing rising memory prices and expenses linked to its Siri artificial intelligence upgrade. Shares fell around 3% in extended trading following the announcement.

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Ternus described current memory pricing as unprecedented and warned that procurement costs could rise further. The shortage is being driven by strong demand from AI data centre operators, including major technology companies, which are competing for limited supplies.

Apple also expects supply constraints affecting iPhones and Macs during the holiday season. Chief Operating Officer Sabih Khan said the company had increased purchasing commitments by $33 billion to secure components.

Despite these pressures, Apple reported market share gains globally across its product categories, according to data cited by Ternus.

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