October 29, 2021

Amazon, Apple Suffer Global Supply Chain Crisis

 Global supply chain problems are also seen to have a major impact on the world's leading companies, Amazon and Apple.

Both companies have reported lower-than-expected earnings by Wall Street analysts and warned that supply chain issues could burden businesses in the December quarter.

Amazon missed Wall Street projections for both sales and profit in the third quarter, a rare situation for the giant.

It recorded net sales of $ 110.8 billion, up 15% from the same period a year earlier, but below analysts ’projections to rise $ 111.6 billion. Net income for the quarter decreased from the previous year to $ 3.2 billion, significantly lower than the expected $ 4.6 billion.

Amazon CEO Andy Jassy warned that for the next fourth quarter, the company’s consumer business expects several billion dollars in additional costs. These include the management of labor supply shortages, rising wage costs, global supply chain issues and rising transportation and shipping costs.

Meanwhile, Apple reported revenue of $ 83.4 billion in the fourth quarter of its fiscal year, with iPhone sales lower than analysts' forecasts of $ 38.9 billion. The company’s net income jumped 62% year -over -year to $ 20.5 billion.

Chief Executive Officer Tim Cook said the impact of supply constraints in the quarter ending Sept. 25, was greater than expected following the disruption of chip manufacturing caused by Covid-19 in Southeast Asia.

He also said that the impact of the supply chain disruption will have a greater impact on current quarter sales.