Apple's Mac business is booming, but the memory market has other plans
New CEO John Ternus toasts record sales as soaring RAM costs threaten supplies and squeeze margins
Apple's Mac business is experiencing a surge, with the company selling more Macs in fiscal 2026 than ever before. However, the rising costs of memory are threatening to disrupt this record-breaking performance. During Apple's fiscal fourth-quarter earnings call, CEO John Ternus expressed concern over the unprecedented memory pricing landscape.
Apple had already raised prices across its hardware lineup, including Macs and iPads in June, and iPhones in September. Despite these price increases and existing inventories, memory costs have yet to peak. For the December quarter, Ternus anticipates even higher memory costs. Mac buyers have remained undeterred, with Apple reporting $10.8 billion from Macs in the September quarter, a 24% year-on-year increase.
The MacBook Neo and MacBook Pro significantly contributed to this growth. Apple's Chief Operating Officer, Sabih Khan, highlighted supply constraints across iPhone, Mac, and iPad during the September quarter, mainly due to limited availability of advanced chipmaking capacity. Now, memory has emerged as the primary challenge. For the December quarter, Khan expects constraints on Mac and iPad, primarily driven by memory shortages.
Apple has already increased its manufacturing purchase obligations by $33 billion between June and September to secure supplies. However, CFO Kevan Parekh noted that gross margin fell by roughly one percentage point between the June and September quarters, primarily due to higher memory costs. Apple expects its gross margin to drop from 47.9% in the September quarter to between 45 and 46% in December, primarily because of higher memory costs.
Additionally, the costs associated with rolling out Siri AI will further impact the figure. Despite these challenges, Apple remains committed to positioning Macs as an AI device, particularly for running models locally. The Mac lineup has been refreshed with M6-powered machines and a touchscreen MacBook Pro, offering customers more reasons to upgrade.
Apple's September-quarter revenue reached $114.5 billion, a 12% year-on-year increase, while iPhone revenue climbed 17% to $57.6 billion. Services generated $31.6 billion, up 10%. Apple forecasts revenue growth of 7 to 10% in the December quarter, despite the supply constraints.
Written by urgent.news from The Register's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
