Morning Edition · Saturday, August 1, 2026Published at 1:33 AM EDT · New York

Apple Loses Close to 500 Billion Dollars as Memory Shortage Splits the Big Technology Trade

The iPhone maker's weak forecast returned the title of most valuable company to Nvidia, while Amazon rose on strong cloud growth.

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Apple Loses Close to 500 Billion Dollars as Memory Shortage Splits the Big Technology Trade

Apple shares fell close to 10 percent after the company guided for September-quarter revenue growth of only 9 to 11 percent, a sharp slowdown from the 16 percent it just reported. The decline reduced Apple's market value by nearly 500 billion dollars and returned the title of world's most valuable company to Nvidia. Outgoing chief executive Tim Cook, speaking on his final earnings call, called shortages of advanced memory chips "very significant" and said Apple had limited means to address them.

The cause lies further down the supply chain. The construction of artificial-intelligence data centers has created enormous demand for advanced memory, and consumer-electronics makers are losing access to the components they need to build phones, laptops, and tablets. The same shortage that is hurting Apple is benefiting the companies that supply computing power.

Amazon showed the opposite outcome. Its shares rose about 9 percent in after-hours trading as Amazon Web Services, the company's cloud division, grew 37 percent from a year earlier, and quarterly revenue passed 200 billion dollars. The company then raised planned 2026 capital spending to about 220 billion dollars, an increase it tied partly to higher memory costs.

The divergence matters for how investors judge the surge in artificial-intelligence spending. Amazon reported measurable revenue to weigh against its capital spending, the evidence skeptics have been demanding. Apple's warning showed that the same infrastructure expansion imposes real costs on companies that consume chips rather than sell computing power.

Part of a tracked trend

AI Trade Derating

Concentration of index gains in a few AI-linked chip and platform stocks makes global equities recurrently vulnerable to sharp, correlated drawdowns whenever investors question the return on AI spending.

What this means

The channel is component supply and the return on capital spending. Concentrated demand for advanced memory redirects scarce chips toward cloud and artificial-intelligence infrastructure, raising profit margins for suppliers such as Amazon Web Services and Nvidia while reducing sales volumes and forecasts for hardware makers such as Apple. Gains in equity indexes stay concentrated in a small number of computing companies, which leaves broad market benchmarks exposed to a simultaneous decline whenever investors doubt that capital spending will earn its return.

What to watch

Memory-chip prices and delivery times. Further tightening extends the pressure on consumer-hardware makers and confirms suppliers' pricing power.
Whether other large technology firms match Amazon by tying capital spending to disclosed revenue growth, which would ease fears that artificial-intelligence outlays are unearned.
Apple's ability to secure components into the holiday quarter, the direct test of how long the shortage constrains its sales.

Observations to monitor, not financial advice.

2 sources

Synthesized from: Economic Times (Apple) · Economic Times (Amazon)