Apple reported $114.5 billion in quarterly revenue and a components inventory that grew nearly fivefold in a year. The pile exists because memory chips are scarce and expensive, and it explains Apple’s pricing, shortages and launch mix better than any grand design does. The method is real, but it is a supply strategy, and it leaves the product doubts untouched.
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Apple closed its fiscal year with $114.5 billion in September-quarter revenue, up 12%, and a balance sheet that shows where the cash is going. Components inventory stood at $10.4 billion on 26 September, against $2.1 billion a year earlier, according to the annual report as summarised by The Motley Fool, while finished goods barely moved. Total inventories in the earnings release rose from $5.7 billion to $14.5 billion. Apple is buying parts early because memory chips have become scarce, and its new chief executive, John Ternus, told analysts on 2 November that current memory pricing has no precedent.
That is the backdrop for a video that ColdFusion published the same day. Its description says Apple is breaking all its rules and seems lost, then asks whether there is a method to the madness. The description also opens with an offer from the learning platform Brilliant, so the video carries a commercial tie. Only the title, channel, date and description could be read for this article, not the spoken commentary, so what follows tests that framing against filings, Apple’s own releases and independent reporting.
Three launches that broke old Apple rules
In the space of about a month Apple put three products in front of the public that its own history argued against. The iPhone Duo, its first foldable, reached customers on 23 October. The MacBook Pro with a touchscreen was presented on 28 October, with Ternus on stage. HomeView, a smart-home hub with a 7-inch square display, is listed for 13 November. Il Foglio called the run a catalogue of scattered attempts rather than a plan, and said Jobs would probably have been driven round the bend.
The touchscreen Mac is the clearest reversal. Steve Jobs once called touchscreen laptops “ergonomically terrible”, and Tim Cook compared merging a laptop and a tablet to combining a fridge and a toaster, The Next Web recalls. Bloomberg reported that Cook and Ternus began backing a touchscreen MacBook Pro about four years ago. One small correction to the usual telling: Ternus said on the earnings call that the Duo was introduced in September, so only its arrival in shops fell in October.
The touchscreen Mac is a price decision
Apple’s release gives the pricing: the 14-inch MacBook Pro with the new PROLED XDR display starts at $2,899, the 16-inch at $3,399, and M5 Max versions climb to $4,799. A non-touch 14-inch MacBook Pro with the M6 chip, announced a day earlier, starts at $1,999, according to The Next Web. The two models use different chip generations, so the gap is not a clean price of touch alone.
IDC puts the average selling price of a touchscreen notebook at about $1,009, with 33.4 million shipped in 2025, Finimize reported from Reuters. Apple is therefore pricing at roughly three times the category average, which points to a premium niche rather than a mass-market bet. The Bloomberg account says the aim was to revive Mac sales and charge more for premium features. Mac revenue rose 24% to $10.8 billion in the September quarter, and Ternus said Apple gained share according to IDC, so the strategy starts from strength.
A parts pile built for a memory shortage
Here the numbers explain more than the product line does. According to the annual report, as summarised by The Motley Fool, components inventory rose from $2.1 billion to $10.4 billion, while manufacturing purchase obligations reached $89.7 billion against $56.2 billion a year earlier, with $82.7 billion due within 12 months. Ternus said those obligations grew by $33 billion in the September quarter alone. Memory is the reason: Apple expects memory costs to keep rising beyond the December quarter.
The cost shows in margin. Gross margin was 47.9%, including about one point from tariff refunds, and without them margin fell about a point from the June quarter, which the chief financial officer, Kevan Parekh, put down entirely to memory. Apple guided December-quarter margin to 45% to 46%. It raised Mac and iPad prices in June and iPhone prices in September, and it expects Mac and iPad supply to stay short in December because of memory. Selling a $2,899 laptop while paying more for every gigabyte is consistent with that arithmetic.
The confusion story against the filings
Il Foglio says Apple’s memory stocks grew 154% in a year. The earnings release shows that total inventories rose 154%, from $5,718 million to $14,541 million, while the components line alone grew roughly fivefold. The direction is the same and the label is different, so the figure is better quoted as total inventories.
The same article says Apple never really focused on AI. Spending argues otherwise: research and development rose from $8.9 billion to $11.7 billion in the quarter, and Parekh tied the 21% rise in operating expenses to R&D investment, with AI the stated driver of December spending growth. The picture is also uneven. iPad revenue fell 10%, which Apple blamed on supply limits and a tough comparison, and wearables, home and accessories fell 8% against last year’s launches. A company with record revenue and two shrinking categories looks less lost than stretched across its supply chain.
The Duo cracks and what Apple has not said
The Duo’s early failures are the strongest support for the video’s mood. Owners reported cracks along the hinge within days of the 23 October launch. Apple told MacRumors that a small number of units are affected and that owners should contact AppleCare for a replacement, but it did not say what causes the fault or whether a fix is planned. An iFixit teardown found several possible causes, including a centre support bar in the hinge that may fail to retract.
The scale is unknown. MacRumors reports that some images of cracked screens appear to be AI-generated, which complicates any count. Supply is the other open number: Apple’s chief operating officer, Sabih Khan, said the Duo is constrained and that he cannot predict when supply and demand will balance. The National adds that Apple enters a foldable market where Samsung and Google already have several years of experience. A quality problem on a first-generation product is ordinary, and the lack of an explanation is the part worth watching.
Siri AI and the bill still being written
The least settled part of the method is artificial intelligence. Apple’s release says Siri AI is in beta, is unavailable in the EU on iOS, iPadOS and watchOS, and that features relying on server-side models are subject to daily usage limits. Ternus told analysts that anyone needing more capacity will be able to buy expanded access in the future. Apple has not said what that access will cost.
The expense is arriving first. Parekh said cloud costs of Siri AI will flow through services cost of sales, and that a share of hardware revenue will be deferred because Siri AI is now bundled with devices. He added that the mix of on-device and cloud queries is still too early to predict. Services, about 28% of September-quarter revenue on the release’s figures, are guided to grow 8% to 9% in December, below the 10% just reported. Apple is spending on AI before it has shown how AI pays for itself.
A deliberate method without a clear product vision
The evidence supports a narrower claim than the video’s framing. Apple is acting on a deliberate, expensive supply strategy: buy parts early, raise prices in steps, and lean on higher-priced hardware. That is a method, and it fits the numbers in the filings. It does not show a single product vision, because a foldable, a home hub and a touchscreen Mac answer different problems, and the material reviewed does not explain how they connect.
Three observable developments would change this reading. December-quarter gross margin landing below the 45% to 46% guide would suggest memory costs are outrunning pricing. A published failure rate or a hardware fix for the Duo would settle the scale of the cracks. A stated price for expanded Siri AI access would show whether the AI spending has a revenue path. Buyers should note that Parekh called it too early to read how higher prices affect demand, so none of these three answers exists yet.
Author:
Jan Bielik
CEO & Founder of Webiano Digital & Marketing Agency
This article is an original analysis supported by the sources cited below
Why Apple Seems Confused
The video page whose description frames Apple as breaking its rules and seeming lost and opens with a Brilliant promotion. Only the metadata was readable, not the spoken commentary.
Apple reports fourth quarter results (Form 8-K, Exhibit 99.1)
Apple’s own figures for revenue, category sales, research spending, gross margin and the balance sheet, including total inventories of $14.5 billion.
Apple unveils groundbreaking MacBook Pro with PROLED XDR Display and Touch for the first time on Mac
Apple’s release with touchscreen MacBook Pro prices, Siri AI availability in beta, the EU exclusion and the daily usage limits on server-side features.
Apple (AAPL) Q4 2026 Earnings Call Transcript
The call transcript with Ternus on memory pricing and the $33 billion rise in purchase obligations, Parekh on margin and Siri AI costs, and Khan on Duo supply.
Apple Just Stockpiled $10 Billion of Parts While Warning Memory Prices Are ‘Unprecedented.’ Should Investors Worry?
A summary of the annual report giving components inventory of $10.4 billion against $2.1 billion and purchase obligations of $89.7 billion against $56.2 billion.
Transition at Apple: Tim Cook to move to executive chair as John Ternus is named CEO
Confirms that Ternus became chief executive on 1 September 2026 and that Cook moved to executive chairman.
Apple launches its first touchscreen MacBook Pro, from $2,899
Reports the launch, the Jobs and Cook remarks, Bloomberg’s account of the four-year backing, and the $1,999 price of the non-touch M6 model.
Apple Finally Brings Touchscreens To The MacBook Pro
Supplies IDC’s average touchscreen notebook price of about $1,009 and the 33.4 million touchscreen notebooks shipped in 2025.
Apple’s strange months. A catalogue of scattered attempts
The commentary closest to the video’s thesis, calling three launches a catalogue of scattered attempts, and the source of the 154% memory figure checked above.
Apple Responds to iPhone Duo Display Cracking Reports
Apple’s statement on a small number of affected units, the missing cause, the iFixit hinge findings and the caution about AI-generated crack images.
Apple to replace iPhone Duos with damaged screens but does not explain fault
Independent confirmation of the replacement offer, the unexplained fault and the competition from Samsung and Google in foldables.
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