Shares of consumer technology giant Apple (NASDAQ:AAPL) fell nearly 3% in after hours trading as the company warned that its sales growth is slowing and supplies are getting tight due to the global semiconductor shortage.
In a conference call with analysts after announcing record quarterly results, Apple said that supply constraints will affect the iPhone and iPad in the current quarter. Decelerating demand for services also will contribute to the slowdown.
The warning of a slowdown cast a cloud over the company’s record-setting quarterly results. Apple reported a sales gain of 36% in the third quarter, with revenue of $81.4 billion U.S. shattering Wall Street’s $73.8 billion U.S. forecast.
The earnings results show that, for now, Apple’s business is booming. The iPhone, Apple’s core product, grew 50% to $39.6 billion U.S. last quarter, beating projections of $34.6 billion U.S.
The third quarter is typically one of Apple’s slowest periods — with consumers holding out for new phone launches in the fall — but the 5G iPhone 12 appears to have helped the company buck that trend.
Apple reported $7.37 billion U.S., or 12% growth, in revenue for the iPad, topping expectations of $7.13 billion U.S. For the Mac, Apple reported revenue of $8.24 billion U.S., or growth of 16%, exceeding the $8 billion U.S. estimate.
Services revenue reached $17.5 billion U.S., above the $16.3 billion U.S. estimate and a third higher than the same period last year. The company has launched a slew of new services in recent years, including Apple TV+ and Apple Arcade.
Apple also saw its wearables, home and accessories segment grow 36% to $8.78 billion U.S. That category includes the Apple Watch, AirPods, Apple TV, the HomePod and various other accessories.
All of Apple’s retail stores had reopened as of June, and the company has also started a hybrid program to help staff work from home or stores with more flexibility.
Apple declined to provide any forward guidance, a practice it adopted during the pandemic.