Apple shares fell 3.9% in US premarket trading on Tuesday, 3 November 2026, according to Economic Times. The company warned that memory chips will keep getting costlier. That could hurt its gross margin in the holiday quarter.
The fall came even though Apple had its best quarter ever in India. For Indian readers, the story shows two things. Indians are buying more Apple products, and good results alone may not lift a share price.
What happened
Apple reported results for July to September. The Hindu BusinessLine calls this period Apple's fourth quarter (Q4). It was John Ternus's first earnings call as CEO since he took over from Tim Cook, according to an ETtech newsletter.
The headline numbers were strong. Revenue and profit both grew 12% from a year earlier. Investors, however, looked ahead. Apple expects its gross margin for the December quarter to be between 45% and 46%, BusinessLine reported. The margin for the September quarter was 47.9%.
Gross margin is the share of sales left after paying the direct cost of making a product. If a phone sells for ₹100 and costs ₹52 to make, the gross margin is 48%. A lower margin means each sale earns a little less.
The numbers
The two publications gave slightly different figures for some items. Both are shown below.
| Item (September quarter) | Economic Times | BusinessLine |
|---|---|---|
| Total revenue | $114.5 billion, up 12% | $114.4 billion, up 12% |
| iPhone revenue | $57.6 billion, up 17% | $57.5 billion, up 17% |
| Mac revenue | $10.8 billion, up 24% | $10.7 billion, up 23.6% |
| Net profit | $30.71 billion, up 12% | Not given |
| Earnings per share | $2.10, against $1.85 | Not given |
| Services revenue | Not given | $31.6 billion, up 10% |
The table shows the gaps are small, but they are real. We could not confirm which figures are right. If you need the exact numbers, check Apple's official results filing.
BusinessLine also reported that revenue rose 5% from the June quarter. Revenue in Asia Pacific, not counting Greater China and Japan, grew 15% to $9.7 billion. Services revenue was an all-time record, even with foreign exchange headwinds of over 1.5 points compared with the June quarter.
Why memory chips matter
Memory chips store data in phones and laptops. Every iPhone and Mac needs them. When they cost more, Apple's cost of making each device goes up.
"What we're seeing with memory pricing right now is unprecedented," Ternus said, according to BusinessLine. Memory cost more in the September quarter than in the June quarter. Two things partly made up for it: older stock Apple had already bought (carry-in inventory) and cheaper prices for some other parts. Apple expects memory to cost even more in the December quarter, and says the help from older stock will shrink over time.
The 47.9% margin also needs a closer look. BusinessLine said that if tariff refunds are left out of both the June and September quarters, the margin fell 1 point from June, mainly because of memory costs. The December forecast also includes some costs for rolling out Siri AI. By our calculation, the 45-46% forecast is 1.9 to 2.9 percentage points below the September margin.
The India story
"We also set September quarter revenue records in both developed and emerging markets, in addition to an all-time record in India," Ternus said on the call. He added that iPhone sales set September-quarter records in the US, mainland China and India.
CFO Kevan Parekh said Mac and Services revenue also hit all-time highs in India, according to ETtech. He credited the MacBook Neo and MacBook Pro for the Mac's growth.
Tarun Pathak, Research Director at Counterpoint Research, told BusinessLine that the iPhone 17 was the top-shipped phone model in India during the quarter. He also pointed out a detail many people miss: iPhone shipments in India fell from a year earlier. Even so, Apple's average selling price in India passed $1,000 for the first time. In simple words, Apple sold fewer iPhones but more costly ones.
Pathak said easy financing, trade-ins, more stores and local manufacturing are turning people's wish to own Apple products into actual purchases. He expects India to move from an "iPhone growth market" to a "full ecosystem market" for Apple, with that shift speeding up in 2027 and beyond. This is his forecast, not a fact.
The wider market mood
Apple's fall came at a nervous time for US tech shares. On Monday, the Nasdaq-100 index closed more than 10% below its all-time closing high, which counts as a correction, Economic Times reported. Investors are worried that Big Tech is spending huge sums on AI without clear returns. Some companies are borrowing to pay for it, as seen when Meta planned a large bond sale.
Last week, Apple passed Nvidia to become the world's most valuable company. At 7:07 a.m. ET on Tuesday, Dow futures were down 0.94% and S&P 500 futures were down 0.19%. Nasdaq 100 futures were up 0.13%. Investors were also waiting for the US midterm election results. Morgan Stanley analysts said the elections should remove a major worry for the market. You can follow more trends on our markets page.
Risks to keep in mind
- Memory costs: Apple itself expects higher memory costs, and the help from older, cheaper stock is shrinking.
- Supply limits: Apple said iPhone and Mac sales grew despite supply constraints. If those limits continue, they could hold back sales.
- Currency moves: Foreign exchange changes already reduced Services growth.
- Market mood: Worries about tech, AI spending and US-Iran tensions are moving markets. Those tensions also pushed oil prices up, which affected gold and silver prices in India.
What to watch next
- Whether Apple's December-quarter margin lands within its 45-46% range.
- Whether memory chip prices keep rising.
- Whether India's iPhone sales value keeps rising while the number of phones sold falls.
- How US markets react to the midterm results.
For more company earnings explained simply, see our results section.
Words explained
- Gross margin: The share of sales left after paying the direct cost of making a product. Higher is better for the company.
- Premarket trading: Trading that happens before the stock market officially opens. Prices can still change once the market opens.
- Earnings per share: A company's profit divided by its number of shares. It shows how much profit each share earned.
- Average selling price: Total sales value divided by the number of units sold. It rises when buyers choose costlier models.
- Carry-in inventory: Parts or goods a company bought earlier, often at older and lower prices.
- Correction: When a share or index falls 10% or more from its recent high.
- Foreign exchange headwind: When currency changes reduce the value of sales made in other countries.
- Futures: Contracts that trade before the market opens and give an early hint of which way an index may move.
Sources: Economic Times, The Hindu BusinessLine.
This article is for information and education only. It is not investment advice. MarketUpDown is not registered with SEBI as an investment adviser or research analyst. Read our disclaimer.