/2021/09/15/1271937547p.jpg)
APPLE - NEW YORK. Supply chain woes cost Apple Inc $6 billion in sales during the company's fiscal fourth quarter, which missed Wall Street expectations, and Chief Executive Tim Cook said that the impact will be even worse during the current holiday sales quarter.
Cook told Reuters on Thursday the quarter ended Sept. 25 had "larger than expected supply constraints" as well as pandemic-related manufacturing disruptions in Southeast Asia. While Apple had seen "significant improvement" by late October in those Southeast Asian facilities, the chip shortage has persisted and is now affecting "most of our products," Cook said.
"We're doing everything we can do to get more (chips) and also everything we can do operationally to make sure we're moving just as fast as possible," Cook said.
Cook said the company expects year-over-growth for its quarter ending in December. Analysts expect growth of 7.4% to $119.7 billion.
"We're projecting very solid demand growth year over year. But we are also predicting that we're going to be short of demand by larger than $6 billion," Cook said.
Read Also: The U.S. economy grew at its slowest pace in more than a year in the third quarter
Shares of the Cupertino, California-based company, which had risen nearly 15% this year, fell 3.4% in extended trading on Thursday. The dip could make Microsoft Corp the world's most valuable company after a run-up in Microsoft shares on the strength of its cloud computing business.
Apple's results were mixed in a fiscal fourth quarter seen as a lull before the high-sales holiday end of year.
Apple said revenues and profits for the fiscal fourth quarter were $83.4 billion and $1.24 per share, compared with analyst estimates of $84.8 billion and $1.24 per share, according to IBES data from Refinitiv.
The results were a rocky end to a fiscal year of above-expectations sales led by its iPhone 12 models and strong sales of Mac computers and iPads for working and learning from home during the COVID-19 pandemic.
Apple told investors in July that chip constraints would start to hit its iPhone and iPad lineups for the first time in the fourth quarter.
Apple posted its results shortly after retailer Amazon.com forecast holiday-quarter sales well below Wall Street expectations, citing labor supply shortages and global supply chain issues in part.
Apple has "managed to navigate the problems fairly well, but hasn’t escaped unscathed, and an extended duration of these problems will spell trouble, especially because the market is unforgiving when it comes to Apple’s performance," said Sophie Lund-Yates, equity analyst at Hargreaves Lansdown.
