Apple posted $56.99 billion in iPhone revenue during its latest quarterly earnings, slightly below analyst expectations, but the company says demand for the iPhone 17 lineup remains extremely strong. According to Apple CEO Tim Cook, supply chain limitations prevented even higher sales, as shortages in advanced processor nodes continue to restrict production.
In an interview with Reuters, Cook said iPhone 17 demand was “off the charts,” while explaining that supply constraints remain a serious challenge. He noted, “There’s just a little less flexibility in the supply chain at the moment,” as Apple faces tighter access to advanced chips largely produced by TSMC.
Apple still relies heavily on TSMC for iPhone processors, but growing AI-related chip demand has created tougher competition for manufacturing capacity. While Apple once dominated TSMC’s customer base, broader demand for high-performance chips has reduced that advantage, creating new production bottlenecks.
Even with these pressures, Apple maintained strong profitability. The company reported gross margins of 49.2% for the quarter, beating expectations and demonstrating its ability to manage rising component costs, including memory and other essential hardware.
Premium iPhone models likely drove strong sales
Although Apple no longer reports unit sales by device, strong consumer interest likely centered around the iPhone 17 Pro and Pro Max models, helped by their new orange color option and redesigned aluminum chassis. At the same time, the standard iPhone 17 attracted buyers by offering ProMotion and an always-on display for the first time in a base model, while the lower-cost iPhone 17e further expanded Apple’s reach.
Apple’s broader business also performed well, with Mac revenue benefiting from the MacBook Neo’s popularity. Overall, Apple reported $111 billion in revenue and $29.58 billion in net profit, setting a new March quarter record despite ongoing supply limitations.
