Apple doubled business in India, lost $6 billion to chip shortage and manufacturing disruptions in Q4: Tim Cook

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Updated: October 29, 2021 10:06 AM

Supply chain constraints had a clear impact on Apple’s financial results this quarter.

Summing up, the CEO said that the pandemic had taught everybody a great deal about flexible work but also reminds of the irreplaceable value of in-person collaboration.Summing up, the CEO said that the pandemic had taught everybody a great deal about flexible work but also reminds of the irreplaceable value of in-person collaboration.

Apple Inc’s September quarter revenue rose 29 per cent on year to $83.4 billion—a record for the quarter—on the back of strong growth in emerging markets. CEO Tim Cook said that Apple achieved double-digit growth across the board, with particularly strong showing in India and Vietnam.

“Apple set quarterly records in every geographic segment with strong double-digit growth across the board,” Cook said during a post-earnings call Friday, adding “during fiscal 2021, we earned nearly one-third of our revenue from emerging markets and doubled our business in India and Vietnam.”

While Mac sales were at an all-time high, iPhone, iPad, wearables, home, and accessories reported record sales during the said quarter. All in all, Apple’s products business grew 30 percent year-over-year. Cupertino’s services business meanwhile performed “better than expected” growing 26 percent year-over-year.

“Our record September quarter results capped off a remarkable fiscal year of strong double-digit growth, during which we set new revenue records in all of our geographic segments and product categories in spite of continued uncertainty in the macro environment,” Apple CFO Luca Maestri said, adding “during the September quarter, we returned over $24 billion to our shareholders, as we continue to make progress toward our goal of reaching a net cash neutral position over time.”

Also Read | Apple Q3 revenue soars on back of double-digit India sales, growth forecast slows as chip shortage concerns reach iPhone

Apple’s earnings fell short of Wall Street expectations of $84.85 billion though. Supply chain constraints had a clear impact on the company’s financial results this quarter.

“We estimate these constraints had around $6 billion revenue dollar impact driven primarily by industry-wide semiconductor shortages and COVID-related manufacturing disruptions,” Cook said.

Several factors including pent-up demand, COVID-19-induced slowdowns, and sanctions against some key Chinese technology companies have all contributed to a global shortage of chipsets—the key component in electronic manufacturing.

Cook—during the last earnings call—had tempered expectations warning that the global chip shortage, which had already hit sales of MacBooks and iPads, will soon affect production of the iPhone potentially slowing down growth. The December quarter could be even more challenging.

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