Apple's Stock Plummets Nearly 10% Amid Component Shortages

Apple's stock price plummeted nearly 10% on Friday after the company released a disappointing forecast, citing struggles to secure enough components due to the AI-driven data centre boom straining global supply chains.

The drop would erase nearly $500 billion from Apple's market capitalization and potentially return the crown of the world's most valuable company to Nvidia. According to Tim Cook, Apple has limited options to address these shortages, calling them 'very significant'.

Big Tech companies have been scooping up advanced chip-making capacity and memory chips to power their AI data centers, leading to shortages and price increases that are expected to shrink both the personal computer and smartphone markets this year.

The company's forecast for revenue growth of between 9% and 11% in the current quarter fell short of Wall Street's estimate, and softer growth in its services business overshadowed otherwise strong June-quarter results. Some analysts worry that the slowdown could deepen if iPhone sales take a hit from a price increase expected during the launch of the new lineup.