alt Hacker NewsI thought Apple usually locked in contracts with TSMC and Samsung for years in the future? They should be best positioned to weather this storm. If they are getting buffeted enough to raise prices by this much, things are going to be dire for smaller manufacturers.
Or, this could just be a convenient excuse to get even more margin.
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The longer you lock in contracts into the future, the more expensive they get. And Apple also doesn’t want to lock themselves into volume commitments for specific production lines and at certain prices that might not make sense anymore a year or two down the line. So even Apple has limits to how much long-term contracts make sense.
It’s not a storm anymore but the new normal. People waiting for prices to come down are going to be very disappointed.
RAM prices started climbing more than 18 months ago. Apple’s contracts are long-term but not that long-term: they probably just expired. (If you assume a 3-year contract, 18 months is how long it would take on average for a specific market shock to hit you)
Its a very, very long “storm”, at some point you have to re-adjust, even if it is very painful
I wonder if this is the real reason Tim Cook is resigning as CEO. He's a supply chain guy and semiconductor supply chains seem utterly borked right now.
Apple has been weathering this for a while. Maybe it was bad timing with a contract rollover but they seem to have lost their primacy with TMSC.
I’m guessing they are doing their best to maintain margins. I don’t know what Apple’s cash chest has these days but it’s always been enormous.
But they don’t score points in the stock market by having cash on hand. They do get points for operating margin.