Apple Inventory Jumps 154% as CEO Ternus Calls Memory Pricing "Unprecedented"

Apple's inventory rose 154.3% from a year earlier in its fiscal fourth quarter as memory chip costs climbed, TechCrunch reported on November 2, citing the company's earnings disclosures and call.

The numbers

According to TechCrunch, Apple's inventory reached $14.54 billion, up from $11.09 billion in the prior quarter (a 31.1% increase) and $5.72 billion a year earlier. Other figures from the report:

• Gross margin for the September quarter was 47.9%.
• Apple forecast a gross margin of 45% to 46% for the December quarter, which the report attributes largely to higher memory costs.
• Manufacturing purchase obligations rose by $33 billion between the June and September quarters.
• iPad revenue was $6.2 billion, below analyst expectations of $6.7 billion and down 10% year over year. Apple blamed supply constraints.

iPad was the only major product segment that did not grow, while iPhone and Mac sales beat estimates, TechCrunch said.

What executives said

CEO John Ternus described memory pricing as "unprecedented" and said he expects even higher memory costs in the December quarter. He said earlier price increases on some devices, on Mac and iPad at the end of June and on iPhone in September, would partly offset them. He expects memory costs to keep rising beyond December, with a shrinking benefit from carry-in inventory.

COO Sabih Khan, who oversees supply chain and manufacturing, repeated the higher purchase obligations and did not rule out further device price increases.

Context

Memory prices have been a recurring pressure point for device makers as AI data centers absorb large volumes of chips. Apple's guidance suggests it expects those costs to weigh on margins for at least another quarter. The company has also said it cannot predict when constraints on its newest iPhone models will ease, according to a separate TechCrunch report.