Apple guides December-quarter gross margin to 45-46% as rising memory costs squeeze profits; shares fall after hours
What happened
Apple beat fiscal Q4 2026 expectations with record $114.48B revenue (+12%) and $2.10 EPS, but on Monday's earnings call warned that December-quarter gross margin would fall to 45-46%, down from 47.9% in the September quarter and below the 47-48% range it had guided for Q4. CFO Kevan Parekh said memory purchase prices are expected to keep rising and that the margin outlook reflects higher memory costs plus spending on AI-powered Siri. CEO John Ternus called current memory-price increases 'unprecedented' and said they will worsen past December. Apple also guided Services revenue growth of 8-9%, below the Street's ~10.7% expectation. AAPL fell about 3% in after-hours trading after closing the regular session down ~1.8% at $338.32.
Why it matters & what’s next are part of Pro, along with the audio summary.
Start your free 14-day trialWho’s affected
- AAPL (negative — margin compression into the crucial holiday quarter); memory-chip makers MU, Samsung, SK Hynix (positive — Apple's guide validates continued pricing power); consumer-hardware peers HPQ, DELL, Lenovo (negative read-through — same component inflation); iPhone supply-chain names (e.g. AVGO, QRVO, SWKS) exposed to hardware-margin pressure.