Apple shares fell after the company warned of supply issues for its devices, while Amazon saw stock gains following strong cloud business performance.
Key facts
- •Apple revenue reached $109 billion, while profits grew to $29 billion.
- •Apple CEO Tim Cook cited unexpected demand for iPhones and Macs as the primary cause of supply issues.
- •Amazon's cloud business, AWS, grew by 37% over the last year.
- •Amazon increased its annual AI spending projection to $220 billion.
- •Apple received approximately $1.1 billion in tariff refunds, which it plans to reinvest in the United States.
Apple warned investors of significant upcoming supply constraints affecting its Mac, iPhone, and iPad product lines, causing its shares to drop more than 7% in after-hours trading. Despite this, the company reported a 16% revenue increase to $109 billion and a 26% profit rise to $29 billion. CEO Tim Cook attributed the supply challenges to unexpectedly high demand for Apple products rather than standard supply chain failures.
By the numbers
Apple Supply and AI Strategy
Apple noted that constraints involve key chip components, specifically microprocessors requiring advanced nodes manufactured by TSMC. While the company is currently managing these limitations, Cook stated that the firm will be scrambling on the supply side in the coming quarter. Additionally, Cook addressed the upcoming relaunch of Siri, describing the ability to run AI on-device as a strategic competitive advantage. Negotiations are ongoing with European Union authorities to facilitate a broad release of the updated assistant.
Amazon Financial Performance
In contrast to Apple, Amazon saw its stock rise 10% in after-hours trading. The company reported a 20% increase in sales to $200 billion, with profits more than doubling to $63 billion. Amazon Web Services (AWS) saw 37% growth, marking its strongest performance in four years. Despite these gains, Amazon reported negative free cash flow of $7.6 billion, driven by heavy investment in AI projects, with projected annual AI spending rising to $220 billion.
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This article was independently rewritten by ManyPress editorial AI from reporting originally published by BBC Business.
