Apple is working to increase the availability of its new foldable iPhone Duo following a rapid sell-out shortly after its release just over a week ago. John Ternus, who replaced Tim Cook as Apple’s chief executive in September, expressed he was thrilled by the initial reception of the $1,999 device. Which sells for £1,999 in the UK, immediately sold out, some buyers have seen their screens crack, while the costly phone. According to nevertheless, Apple, On Monday that over the last year it sold more iPhones globally than it ever has before.
Despite the high consumer demand, supply remains uncertain. Sabhi Kahn, the company’s new chief operating officer, acknowledged during a financial results call that it is difficult to predict when the supply-demand balance will stabilize. Currently, the company does not know when more units will be available for purchase. The situation has been made worse by what the company has repeatedly insisted is “unexpected demand” for its products.
The launch has faced technical scrutiny alongside logistical hurdles, as some users have reported screen cracks on the devices. Last week, Apple confirmed it would provide replacements for the small number of phones affected by cracking along the inside fold. Executives did not address these defects during the recent investor call.
Financially, Apple reported a strong year with total sales rising 15% to $479bn. During the quarter ending September 26, total iPhone sales grew 17% to $57bn. Mac computer sales also reached a record $10.7bn, marking a 27% increase. Conversely, sales for iPads and wearable products, including watches and headphones, declined by 10% and 7%, respectively. Which did not include sales of the iPhone Duo that went on sale toward the end of October, Apple saw iPhone sales rise 17% to $57bn, during the three months to 26 September.
Operational challenges continue to impact production. Kahn noted that most Apple devices are currently subject to supply constraints, particularly regarding advanced microprocessor nodes manufactured by Taiwan-based TSMC. These shortages are expected to persist into next year, impacting both iPad and Mac availability.
The company is also grappling with significant cost pressures.
Ternus highlighted unprecedented increases in the price of memory components.
As AI chatbots and platforms from companies like OpenAI and Anthropic drive a massive surge in data centre demand, storage prices for manufacturers have climbed. Earlier this year, Apple described this spike in data infrastructure costs as a thousand-year flood, leading to a roughly 20% price increase across the company’s hardware portfolio. Including those developed by OpenAI and Anthropic, have become popular, much of that memory storage runs through data centres which have seen a huge boom in demand for space as artificial intelligence (AI) chatbots and platforms. It has led to the company raising prices on essentially all of its hardware products by around 20%.
Market analysts have viewed the company’s overall performance positively. Sunil Krishnan of Aviva Investors described the latest results as solid, particularly regarding the iPhone division. While acknowledging concerns over profit margin guidance and rising chip costs, Krishnan noted that profit margins exceeding 45% remain impressive for an established technology firm. While there were concerns over the company’s guidance on profit margins and the cost of memory chips, Krishnan added that in the broader context, “margins well north of 45% for a very well-established company, I think, are pretty impressive”.
