He told analysts on the call that supply chain issues would hurt sales in the current quarter by US$4 billion to US$8 billion, “substantially larger” than the hit in the quarter to March.

Areas near major iPhone plant in China under lockdown in Zhengzhou

Supply chain problems were focused on a corridor in Shanghai and reflected Covid-19 disruptions and silicon shortages, Maestri added. The pandemic was also affecting demand in China, he said.

Chief executive Tim Cook said that almost all of the Chinese factories doing final assembly of Apple products had restarted after Covid-19 shutdowns, but the company is not forecasting when a silicon shortage would end.

Cook said he hoped Covid-19 issues would be “transitory” and “get better over time”.

At least one analyst said the outlook lacked clarity.

“We were all looking for just better guidance on what is really going on [in China] … and that didn’t come out,” said Louis Navellier, chief investment officer for Navellier & Associates.

Kim Caughey Forrest, chief investment officer at Bokeh Capital Partners, said that ongoing demand remained a big question, despite Apple’s management of supply chain in the March quarter.

Indeed, other high-profile tech companies also raised concerns. Amazon.com on Thursday posted a disappointing outlook as it was swamped by higher costs, sending its shares down 9 per cent after the close, and Intel Corp forecast a gloomy quarter based on supply chain issues, and its stock fell 4 per cent.

Apple’s overall fiscal second-quarter revenue was US$97.3 billion, up 8.6 per cent from last year and higher than analysts’ average estimate of US$93.89 billion, according to Refinitiv data.

Worldwide smartphone sales revenue was US$50.6 billion, a 5.5 per cent increase from a year ago, and services sales rose 17 per cent to US$19.8 billion, both ahead of analyst average forecasts.

However, Maestri said that services growth would decelerate from the March quarter, while remaining in double digits. He cited several factors, including more unfavourable currency exchange rates.

Total profit was US$25 billion, or US$1.52 per share and easily topped analysts’ expectations of US$23.2 billion and US$1.43.

Apple also raised its dividend 5 per cent to US$0.23 per share and the board approved a buy-back for an added US$90 billion in shares.

Investors have been bracing for drops in consumer spending on tech gadgets and services as the war in Ukraine and other factors drive up the cost of oil, food and other staples.

Cook shrugged off an analyst question on inflation and consumers.

“We’re monitoring that closely. But right now, our main focus, frankly speaking, is on the supply side,” he said.

Asked about rising inflation, Maestri said demand, particularly for iPhones, had been higher than the company had anticipated at the start of the quarter. But he noted inflation was affecting expenses.

The pandemic, including the shift to hybrid work, has benefited other businesses.

Apple said iPad sales fell 2 per cent to US$7.65 billion due to supply-chain constraints, while revenue from Mac computers, also facing supply-chain issues, rose 14.7 per cent to US$10.4 billion.

Sales of wearables, home speakers and accessories rose 12 per cent to US$8.8 billion, and was the only unit to miss Wall Street targets. Maestri said Apple Watch and AirPods sold well, and attributed the miss to seasonal variability in demand for other accessories.

Apple said it now has 825 million paying subscribers across its at least seven subscription offerings, up by 40 million from 785 million last quarter. Its growth comes as rivals such as Netflix reported subscriber losses.