Editorial Team
5 min read
Apple’s record June quarter was helped by tariff refunds, while its September-quarter outlook combines continued demand with tighter supply and higher memory costs. The pressure arrives as hardware chief John Ternus prepares to become CEO.
Apple has delivered a record June quarter while warning that it may have less product to sell in the one now under way. The company said supply constraints affecting iPhone, Mac and iPad will increase significantly quarter over quarter, even though it continues to expect high demand.
That is a narrower warning than a prediction of shrinking sales. Apple still forecasts growth. But it shifts the immediate question from whether customers will buy its devices to whether the company can obtain enough parts, and at what cost, without sacrificing the margin that made its latest results look unusually strong.
Tim Cook and John Ternus at Apple Park. Photo: Apple. Source: Apple.
Apple reported $109.4 billion in June-quarter revenue, up 16% year over year, and $2.02 in earnings per share. The business set June-quarter records in iPhone, Mac and Services, while iPad was the only product line whose sales did not rise. Its earnings report also said revenue rose in every geographic segment.
For the current quarter, Apple forecast revenue growth of 9% to 11%, versus the 12% expansion analysts surveyed by LSEG expected. It said foreign exchange would subtract 2.5 percentage points from growth, expected iPhone revenue to grow in the mid-teens, and guided to gross margin of 47% to 48%, as described in the earnings coverage.
Those figures separate several pressures that the provisional results can blur: foreign exchange, component availability and higher input costs. Apple has not put a revenue or unit figure on the supply hit. Its forecast therefore supports a conclusion that the constraints will affect the quarter, not a calculation of sales that will be lost to them.
Tim Cook, Apple’s CEO since 2011, said the company had paid more for memory in each of the preceding three quarters and expected still higher costs in the September quarter. He said inventory Apple had held and anticipated savings on non-memory components would offset some of the increase, but warned that market pricing could rise further after September.
The company’s own response makes clear that the pressure is not usefully described as memory alone. It raised Mac and iPad prices in June amid a supply crunch for memory and other parts, including processor-manufacturing capacity; it has not raised iPhone prices in most markets. Cook called the position difficult and said it was not good for consumers in a report on the call and subsequent interview.
Cook characterized the memory-price surge as a “hundred year flood” and said the DRAM market was essentially controlled by Micron, SK Hynix and Samsung. He said Apple was evaluating options in the report. That supplier concentration explains why inventory and savings elsewhere are mitigations rather than a demonstrated solution to the availability problem.
Company-reported June gross margin was 50.06%; current-quarter guidance is 47% to 48%. Source: CNBC.
Apple’s June-quarter net income was $29.79 billion, or $2.02 a share, compared with $23.43 billion, or $1.57 a share, a year earlier. Tariff refunds accounted for 11 cents a share and two percentage points of gross margin, taking reported gross margin to 50.06%.
The comparison base matters. The reported result said the margin was about in line with expectations without the rebates. The current-quarter guide of 47% to 48% is a more relevant disclosed range for judging how higher parts costs, inventory and any pricing changes are interacting. A tariff refund can lift one quarter’s earnings; it does not establish that Apple has neutralized recurring component inflation.
John Ternus, whom Apple says will become chief executive on September 1, 2026. Photo: Apple. Source: Apple.
John Ternus is Apple’s senior vice president of Hardware Engineering and becomes chief executive on September 1, with Cook moving to executive chairman. Ternus joined Apple’s product-design team in 2001, became a hardware-engineering vice president in 2013 and joined the executive team in 2021. Apple says his organization has worked across its product categories, including iPhone, Mac, iPad and AirPods—directly relevant experience for a transition occurring amid constraints on the company’s largest device lines.
Apple’s board unanimously approved the succession after a long-term planning process; Ternus will also join the board, while Cook is to assist the company on some matters including engagement with policymakers. Those details come from Apple’s announcement and describe a planned transition, not a new supply strategy.
Ternus made no prepared remarks on Cook’s final earnings call. When asked about the competitive landscape, he reiterated that Apple saw opportunity and was focused on its plans, according to the call report. The company has not publicly attached a specific remedy or timetable to the supply constraints heading into his CEO tenure.
The next results should clarify four linked issues: whether gross margin lands within the 47% to 48% guide; whether the supply constraints curb sales of the named product lines; whether held inventory and non-memory savings meaningfully offset higher memory prices; and whether Apple changes prices beyond the Mac and iPad increases already made in June.
Apple’s guidance shows that demand and growth have not disappeared. The evidence does not yet show how much revenue constrained supply will prevent the company from recording, or whether higher costs will be borne mainly in margins, prices, or both. Those disclosures—not the strength of the June quarter alone—will determine how large the operational problem is for Ternus’s first months in charge.
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