Apple Increases Component Inventory to $10.4 Billion Amid Unprecedented Memory Price Surges
Apple has significantly increased its component inventory to $10.4 billion, up from $2.1 billion a year ago, as the company moves to secure supply amid rising costs for advanced chips and memory. This strategic stockpiling is driven by what CEO John Ternus described as 'unprecedented' memory pricing trends that are expected to intensify. To support this buildup, Apple's manufacturing purchase obligations rose to $89.7 billion at fiscal year-end. The surge in component costs is directly impacting profitability; Apple guided December-quarter gross margins down to 45%-46% from previous levels. While the company has begun passing some costs to consumers through price hikes on iPads, Macs, and iPhones, management warned that these increases could potentially reduce product demand. Despite these supply chain headwinds, Apple reported record quarterly revenue of $114.5 billion, driven by strong iPhone sales.
Tickers: $AAPL
Topics: inventory buildup manufacturing obligations memory shortage supply chain costs
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