Apple CEO Tim Cook holds up the new iPhone 17 Pro during a special Apple event held at Apple’s headquarters in Cupertino, California, on September 9, 2025.
Justin Sullivan | Getty Images
apple reported strong first-quarter profits on Thursday and predicted growth for the current quarter of up to 16%, in line with the just-ended period.
Apple said sales could increase further if the company can secure enough chips to meet customer demand for iPhones.
“We expect our companywide revenue for the March quarter to increase 13% to 16% year-over-year, which fully reflects our best expectations for limited iPhone supply during the quarter,” Finance Director Kevan Parekh told analysts Thursday.
On the company’s earnings call, analysts asked Chief Executive Tim Cook several questions about Apple’s access to memory components, whose prices are rising due to demand for chips needed for artificial intelligence data centers. This caused a memory shortage.
Instead of dwelling on memory, Cook focused on increasing demand and wasting the company’s inventory. He said what is preventing Apple from producing more iPhones is access to advanced node manufacturing for A-series and M-series chips, which the company calls SoCs (systems-on-chip).
Apple manufactures advanced node chips in cooperation with Taiwan Semiconductor Manufacturing Co., Ltd., which dominates the advanced node manufacturing market. Apple announced Thursday that it is exploring manufacturing at its 3-nanometer node.
“The constraints we have are driven by the availability of advanced nodes where our SoCs are produced, and at this time, due in part to increased demand, our supply chain is less flexible than usual,” Cook said.
Cook said Apple is in the process of expanding access to supply and did not want to make predictions beyond March.
While this quarter’s supply shortage is related to advanced node chip manufacturing, Cook acknowledged that Apple will be affected by rising memory prices and said the company is considering “a wide range of options” for what it can do. But he declined to discuss specifically how Apple is tackling the AI-driven shortages that are affecting nearly every device maker around the world.
“As always, we will consider various options to address it,” Cook said.
Apple said it expects gross profit margins to be between 48% and 49% in the March quarter, and that at the midpoint, gross margins will be higher than in the December quarter. Cook said higher memory prices had a “minimal impact” on Apple in the December quarter, but would have a more significant impact in the March quarter.
Last year, Apple announced it would spend more than $600 billion in the U.S. over five years, much of it going to a small number of companies committed to making chips in the U.S., including TSMC, which has historically done most of its manufacturing in Taiwan.
Mr. Cook announced Thursday that Apple will procure 20 billion chips from the U.S. in 2025, which is higher than the company’s previous goal of 19 billion U.S.-made chips.
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