Apple reported holding $11.1 billion in inventory as of its recent earnings, nearly doubling the $5.7 billion from last September. This significant stockpiling reflects concerns about worsening supply constraints, particularly related to advanced memory components critical for its Apple silicon chips used in iPhones and Macs. The company’s outgoing CEO Tim Cook described the situation as a "hundred-year flood" on memory pricing, driven by steep demand fueled by the generative AI boom.

Despite these challenges, Apple posted its strongest June quarter yet, with iPhone sales up 22% and Mac sales rising 29% year-over-year. However, Cook warned that the supply chain flexibility is limited, and the impact of material shortages is expected to grow more severe in the coming months. To tackle rising component costs and supply issues, Apple “reluctantly” increased prices for Macs and iPads in June, following a trend also seen at other hardware giants like Meta, Samsung, Microsoft, and Sony.

The memory shortage, sometimes referred to as "RAMageddon," is especially disruptive because it affects the production of essential chips powering Apple devices. Apple anticipates revenue growth of 9% to 11% year-over-year for the next quarter, down from the usual 16% growth seen in recent quarters. This tempered forecast and inventory buildup triggered a 6% dip in Apple’s stock during after-hours trading.

As Apple prepares for the leadership transition to Senior VP of Hardware Engineering John Ternus as CEO in September, the company faces a tough period driven by supply challenges shared across the tech industry. Despite these pressures, Apple continues to prioritize managing the supply chain proactively rather than reacting to shortfalls, trying to maintain momentum amid a complex global semiconductor shortage environment.