The upper stage of a SpaceX rocket that delivered two lunar landers in early 2025 is set to come crashing down on the lunar surface several months after it ended its mission. According to Japan Today, the large piece of rocket debris is expected to hit the moon at an estimated 5,400 mph or 8,690 kph, which is seven times the speed of sound.
While a piece of debris hitting the moon might seem like an inconsequential event for most people, scientists and astronomers are keeping a close eye on it because this will be one of the few times that an object will impact the moon while being observed. NASA’s Lunar Reconnaissance Orbiter and South Korea’s Danuri lunar orbiter will take before-and-after photos of the impact site, while the latter will also fly close to the stricken SpaceX rocket a few minutes before it begins its final descent.
NASA has previously deliberately crashed objects on the moon — it did this with sections of the Saturn V rocket and discarded Lunar Landers to conduct seismic experiments during the Apollo missions in the 70s. It repeated the experiment in 2009 with its LCROSS mission, where it crashed the probe near the south pole of the moon in search of ice.
What interests researchers this time is how the impact will affect the surface of the moon, which is expected to deliver energy that’s equal to about three tons of TNT. Even though this might seem like a huge amount of energy, we likely cannot see the actual crash from Earth. But because the moon does not have wind or an atmosphere, the ejected material could stretch for miles and be visible on telescopes.
“The gravity on the moon is low and there is no wind to blow the dust away,” said Benjamin Fernando of the Los Alamos National Laboratory. “Part of the reason for our interest in this event is to figure out how much of a hazard debris impacts pose to future astronauts.”
Space debris is not a major concern for the moon as it is for our planet at the moment, but this might change in the near future. As the U.S. and China are locked in a space race to see who will be the first one to land on people on the moon again after more than half a century, there will soon come a time when operators cannot just leave their rocket debris in an orbital decay, lest it come crashing down on their settlements and data centers.
Apple in China occupies a position unlike the company’s presence in any other country. China is simultaneously a major consumer market, a critical manufacturing center, an extensive developer economy and the home of Apple’s most determined hardware competitors.
That combination creates an opportunity few technology companies can ignore. China has hundreds of millions of affluent mobile users, a strong appetite for premium devices and a digital economy built around smartphones.
It also creates unusual complexity. Apple must compete with Huawei, Xiaomi, Oppo and Vivo while satisfying Chinese regulations, navigating tensions between Beijing and Washington and reducing its manufacturing dependence without damaging the supplier network that helped make the iPhone possible.
The latest market figures show why Apple cannot treat China as a business it has already lost. IDC estimated that Apple captured 18.1 percent of Chinese smartphone shipments during the second quarter of 2026, placing it second behind Huawei at 22.6 percent.
Apple’s shipments increased by 24.4 percent from the previous year even as the wider Chinese smartphone market contracted. The recovery demonstrated that Chinese demand for the iPhone remains substantial when product design, storage, performance and pricing align with consumer expectations.
The same figures also show why the position can never be considered secure. Huawei remains ahead, local brands respond quickly and a few percentage points can separate several major vendors.
Apple in China Still Has Room to Grow
China is already one of Apple’s largest markets, but its scale means that even established product categories contain room for expansion.
The country has a large premium smartphone segment, extensive 5G coverage and consumers accustomed to using mobile devices for communication, payments, shopping, entertainment, transport and work.
An iPhone purchase can also lead to AirPods, Apple Watch, iPad, Mac, iCloud storage and paid applications. The commercial opportunity is therefore larger than the initial handset transaction.
Apple’s strongest advantage is its integrated ecosystem. An iPhone can share passwords, photographs, messages and files with a Mac or iPad, while AirPods and Apple Watch extend the experience without requiring separate accounts and setup systems.
That continuity becomes more valuable as households accumulate devices. Replacing one iPhone is relatively easy. Leaving an ecosystem containing several products, purchased applications, cloud storage and shared family services involves greater friction.
Apple also benefits from a premium identity that remains recognizable in China. Local manufacturers now produce sophisticated flagship phones, but the iPhone continues to operate as both a personal computer and a luxury consumer product.
The importance of that status should not be exaggerated. Chinese buyers are technically informed and increasingly willing to support domestic brands. Brand recognition can attract attention, but it does not excuse weak features or an uncompetitive product cycle.
Recent iPhone Demand Shows the Opportunity
Apple’s 2026 recovery offers a useful example of how quickly its position can improve.
China’s smartphone shipments fell 4.3 percent during the second quarter as memory and component costs pushed several manufacturers toward higher prices. Apple and Huawei held prices more stable, giving buyers a reason to purchase while competing brands became more expensive.
The iPhone 17 generation also addressed several areas where Apple’s standard models had appeared conservative beside Chinese flagships. Stronger base specifications made the regular iPhone more competitive without requiring every customer to move into the Pro tier.
This matters in a market where consumers compare display technology, camera systems, storage, battery life, charging and AI features closely. Apple cannot depend entirely on iOS loyalty when domestic companies introduce visible hardware improvements at several price levels.
The rebound does not establish a permanent trend. Smartphone demand in China remains affected by economic confidence, upgrade cycles, government incentives and the timing of major shopping festivals.
Apple’s position can also look different according to the research firm and whether a report measures shipments or consumer sales. Quarterly rankings should be treated as evidence of momentum rather than a final judgment on the market.
The important signal is that Chinese consumers have not broadly rejected the iPhone. Demand can return rapidly when the product and price create a convincing upgrade.
Huawei Makes China Apple’s Hardest Market
Huawei gives Apple a competitor with advantages unavailable to most global smartphone manufacturers.
The company combines strong national recognition with advanced cameras, communications technology, custom chips, local services and an expanding HarmonyOS ecosystem. Its return to premium smartphones removed the opening Apple had gained when U.S. restrictions disrupted Huawei’s access to important components.
Huawei can also position its products as part of China’s technological self-reliance. That message carries commercial and political weight beyond a conventional comparison between two phones.
Apple must therefore compete against product quality and national sentiment simultaneously. An iPhone can offer strong performance and still lose a purchase to a domestic flagship viewed as technically capable and strategically important.
Xiaomi, Oppo and Vivo add different pressures. They move quickly across price categories, experiment with folding designs, adopt larger batteries and provide features adapted to local applications and buying habits.
Chinese phone makers also operate inside a retail and software environment they understand directly. They can build relationships with local platforms, carriers and commerce services without translating a global strategy into Chinese requirements.
Apple follows a more centralized product model. That consistency protects the identity of the iPhone, but it can make the company slower to answer features gaining popularity inside one country.
Services Depend on Local Rules
Apple in China is not only an iPhone business. The installed device base creates demand for applications, cloud storage, entertainment, subscriptions and digital purchases.
China has an enormous developer community producing games, commerce platforms, social services, education tools and productivity software. The App Store connects those developers with high-value iPhone and iPad customers.
The relationship is commercially important but politically complicated. Apple must operate the mainland App Store according to Chinese law, including rules affecting games, generative AI, communications services and content.
Applications available elsewhere may be absent from the Chinese storefront. Developers may also need licenses or regulatory approval before distributing certain categories of software.
Apple changed commission rates and related policies for the mainland China storefront in March 2026. The company described the adjustments as part of maintaining a strong business opportunity for Chinese developers.
Regulatory and developer pressure has not disappeared. Complaints involving commissions, distribution restrictions and payment policies continue to challenge Apple’s control of the platform.
The company cannot simply copy its response from another region. European rules focus heavily on alternative marketplaces and interoperability, while China combines competition concerns with content regulation, data localization and licensing requirements.
Every concession must therefore be designed for a distinct legal environment without fragmenting iOS into an unmanageable collection of regional systems.
China Is Also Part of the Product
Apple’s relationship with China extends far beyond the devices sold there.
For more than two decades, Apple and its manufacturing partners built a dense network of factories, component suppliers, engineers, logistics operators and toolmakers across the country.
That network does more than provide low-cost labor. It can place specialists from several suppliers near an assembly site, modify production lines quickly and increase output to enormous volumes during a product launch.
China’s infrastructure also supports the less visible stages of manufacturing. Components require precision tooling, testing equipment, chemicals, packaging, subassemblies and experienced quality-control teams before final assembly begins.
Apple has expanded iPhone production in India and moved parts of its Mac, iPad, Apple Watch and AirPods supply chains to countries including Vietnam. It is also increasing semiconductor and component commitments in the United States.
Those investments reduce the danger of relying on one country, but they do not recreate China’s complete manufacturing environment immediately.
A factory in another region may assemble an iPhone while still depending on Chinese machinery, materials, subcomponents or engineering support. Production diversification is therefore a gradual redistribution of individual stages rather than a clean departure.
Apple must reduce concentration risk without weakening the manufacturing system responsible for its product quality, scale and launch schedules.
Image Credit: AFP Photo
Trade Tensions Turn Efficiency Into Risk
The same China supply chain that provides Apple with extraordinary efficiency also exposes the company to political decisions outside its control.
Tariffs can raise the cost of devices exported from Chinese factories. Export restrictions can limit access to materials or production equipment, while sanctions may affect suppliers and technology partners.
Chinese government policies can influence the use of foreign devices inside state agencies and companies. U.S. rules can restrict the technologies available to Chinese firms that also participate in Apple’s supplier network.
Apple cannot solve these problems through product design alone. It must maintain relationships with two governments whose technology policies increasingly emphasize security, domestic production and strategic independence.
Moving more assembly to India gives Apple additional flexibility, particularly for iPhones destined for the United States. China nevertheless remains important as a production center and consumer market.
An aggressive withdrawal could damage supplier relationships and local sales. Moving too slowly could leave Apple vulnerable to another trade disruption.
The company is trying to preserve Chinese capabilities while creating enough capacity elsewhere to keep a political dispute from becoming a worldwide product shortage.
Retail Stores Give Apple a Direct Relationship
Apple’s physical stores remain an important advantage in China because they give the company direct contact with customers.
The stores allow buyers to compare models, receive technical support, attend educational sessions and enter the ecosystem without depending entirely on a carrier or reseller.
That experience is particularly valuable for premium products. A customer considering a Mac, Apple Vision Pro or high-end iPhone may need more explanation than someone replacing an inexpensive handset.
Retail locations also communicate long-term commitment. A prominent store represents more than a sales channel; it signals that Apple intends to remain part of the local technology market.
Online commerce is equally important. Chinese consumers are accustomed to large shopping festivals, aggressive promotions and rapid delivery through domestic platforms.
Apple must balance its controlled global pricing with a market where discounts can change quarterly rankings. Too little flexibility makes the iPhone appear expensive, while frequent reductions can train customers to delay purchases and weaken its premium image.
The strongest 2026 performance came partly from avoiding price increases while component costs were forcing rivals to reconsider their pricing. That advantage may disappear when competitors adjust their supply chains or launch another cycle of promotions.
Chinese Consumers Set a Higher Product Standard
China is often discussed as a sales problem for Apple, but it also functions as a demanding test of the iPhone.
Domestic flagship phones compete through larger batteries, rapid charging, advanced camera hardware, folding displays and deep integration with local digital services.
Features considered experimental elsewhere can become established expectations more quickly in China. Apple’s slower adoption cycle may look disciplined in one market and conservative in another.
The company must decide which expectations represent durable improvements and which are temporary specification contests. Copying every local feature would weaken Apple’s focused product strategy, but ignoring major changes creates openings for rivals.
This pressure can benefit Apple globally. Competition in China forces the company to defend the value of its standard iPhone, improve battery efficiency, strengthen cameras and make software features more useful outside English-speaking markets.
The opportunity is therefore not limited to selling more devices. China can reveal where Apple’s global assumptions no longer match the most competitive part of the smartphone industry.
Seven states have reported cyberattacks on their water supply control systems, with some officials suspecting that Iran is behind these actions. According to the New York Times, there isn’t any definitive proof yet that Iran orchestrated these attacks but it said that moves like this have been escalating since the U.S. began its bombing campaign of the country. It was also noted that the attackers made zero financial demands, making it more likely to have been conducted by state actors that aren’t just motivated by money.
Minnesota was the first to report this kind of attack, with Michigan soon saying that it was targeted, too. While there have been no major disruptions that have made tap water unsafe to drink, the authorities across local and state governments are still on the lookout for potential problems. They’re particularly concerned about older computer systems that monitor water quality, adjust chemical treatments, and control water pressure, especially those that are connected to the internet.
Braham, Minnesota, is one of the areas affected by the cyberattacks. The mayor of the small city, which has a population of less than 2,000 people and is located about 50 miles north of Minneapolis, said it has already received guidance on how to resolve the issue and strengthen its defenses against future attacks. It’s currently using manual control to keep the water service on, but its mayor, Nate George, told the publication, “I think the troubling thing on the horizon is how do we move forward to a more secure system. IT infrastructure upgrades are very costly, and we are a very small municipality.”
He also repeated the suspicions that some federal officials had but declined to confirm. “We’re getting bits and pieces of information from the state of Minnesota and the F.B.I. They are pretty sure it’s Iranian actors.”
While states scramble to protect their utilities and other critical infrastructure, the White House has downplayed the suspected state-sponsored cyberattacks. President Donald Trump told a reporter, “I think Minnesota is behind it. I don’t think there was an Iranian cyberattack.”
Iran was also once on the receiving end of a cyberattack that many experts link to the U.S. The most famous of these was Stuxnet, which was supposedly used in 2009 to significantly damage and destroy critical tools used by the Iranian nuclear program. More recently, the CanisterWorm malware attacked Iranian machines and wiped them clean for no apparent reason. Again, no one has claimed responsibility for this attack.
Wars have always been fought on land and on sea, and more recently, in the air and in space. But as the internet has become indispensable for society, cyberspace has quickly become a fifth domain that states must protect and dominate. “This is what modern warfare looks like,” Gov. Tim Walz said on X.
I’ve heard that in Germany you can buy sausages in vending machines. What should be sold in machines that isn’t offered at the moment? Sybil Freestone, Oregon
Post your answers (and new questions) below or send them to nq@theguardian.com. A selection will be published next Sunday.
Elon Musk’s Colossus data centers that sit near the border between Tennessee and Mississippi will finally be removed starting this month. According to the company, the 69 temporary mobile turbines, which have been the subject of a lawsuit that claims they have been causing pollution, are going to be completely removed by July 2027, meaning it will take the company 12 months to withdraw the trailer-mounted generators from its premises. This may sound confusing, as they’re “portable” generators, after all, but it seems that SpaceXAI is removing them in phases as its 1.2GW power plant slowly comes online.
SpaceXAI achieved one of the fastest data center deployments ever after it set up 100,000 Nvidia H200 GPUs in 19 days — something that Nvidia CEO Jensen Huang said usually takes four years or more. Musk achieved this by bringing in his own power instead of waiting to get connected to the grid, which was considered a novel idea at that time. Today, a few data center operators, like OpenAI, are following Musk’s footsteps and deploying their own turbines to power their servers without relying on other providers.
But even though the idea feels innovative, the community surrounding the Colossus 1 and Colossus 2 data centers has been complaining about the pollution that these mobile turbines bring. They say that these turbines didn’t have the required permits to operate, although the company argued that the mobile and temporary nature of these units exempted them. The EPA said earlier this year that these units aren’t exempt from permits, but SpaceXAI continued to operate them anyway. It has even got to the point that the NAACP filed a case over these unpermitted turbines, although the DOJ weighed in, saying that removing them would put national security at risk as Colossus 2 “supports mission-critical operations.”
Despite that, it seems that SpaceXAI has finally settled into an agreement with the Mississippi Department of Environmental Quality. It’s if the 1.2GW power plant replacing these mobile turbines is the same one that Musk is importing from overseas, but the important part is that it’s approved under a Clean Air Act permit. Aside from that, the company also said that it’s equipping all its mobile turbines with “advanced emission control technologies,” which should reduce the environmental impact of its power sources.
Tech enthusiasts are a passionate bunch, and the rich ones among them are willing to put their money where their mouth is. This is exactly what we see with a signed Steve Jobs business card from 1983, which is posted on RR Auction and is going for $70,741 at the time of writing. What made this relic special is that Job’s business cards from 1983 are a rare commodity and remain in high demand from collectors. It also received a Gem Mint 10 grade — the highest possible rating from PSA/DNA and is certified to be authentic.
RR AuctionRR Auction
RR Auction says that it has auctioned off 15 Steve Jobs business cards in its history, but only four of those come from 1983. This is also only the second one to bear the signature of Apple’s founder, which was put on the auction block in 2024 and fetched an eye-watering $180,000. The card on auction right now isn’t exactly perfect, with the website describing it as “In fine condition, with light soiling and staple holes to the upper section, none of which affect the bold signature.” Still, there’s at least 16 bids on the item, and the next bid is currently listed at $77, 816.
This isn’t the first time that an item related to an iconic founder has fetched thousands of dollars on the auction block. Just last month, Sotheby’s estimated that Nvidia CEO Jensen Huang’s iconic Tom Ford leather jacket, which costs $9,000 if you buy it new, would get up to $60,000. However, when the hammer finally closed the auction, the winning bid hit $960,000, which, we believe, is driven by Jensanity.
Unfortunately, if you’re not into the personal effects of CEOs and want something more substantial, you’ll probably have to fork out a lot more money. One example we have is the Apple-1 ‘Prototype Board #0,’ which sold for $2,750,000. Aside from costing a lot of money, these are rare finds, and you’ll have to wait years, if not decades, to get a chance at owning something so exceptional. But if you have a hole burning in your pocket and want to start a tech-related collection, but find the Steve Jobs business card a bit above your budget, an unreleased batch of 97 Duck Hunt and Super Mario Bros. NES cartridges has recently been discovered at a retro shop, most of which are graded 9.6 or higher by PSA. Three examples are about to enter auction on August 12, and they’re estimated to start at four figures, which might make it more “attainable” to fledgling collections.
Japan earthquake relief efforts will receive financial support from Apple following the powerful earthquake that struck Kumamoto Prefecture on the island of Kyushu.
CEO Tim Cook announced the donation through social media on July 30. He expressed concern for people facing the earthquake and continuing aftershocks while thanking the first responders helping affected communities.
“Japan has a very special place in my heart.”
Cook wrote before confirming that Apple was making a donation to support relief work.
Apple did not disclose the amount, recipient organizations or whether its contribution would support the immediate emergency response, longer-term reconstruction or both. The company frequently keeps disaster donation amounts private, even when Cook publicly confirms its participation.
The announcement came as rescue teams continued searching damaged homes, industrial facilities and the remains of a shopping center. Survivors were dealing with water shortages, disrupted transportation, damaged buildings and dangerous summer temperatures.
Image Credit: Wikimedia
Japan Earthquake Relief Follows Deadly Kumamoto Disaster
The earthquake struck southwestern Japan on Tuesday, July 28. Japanese reporting and international agencies have described it as a magnitude 7.1 event, while the U.S. Geological Survey measured it at magnitude 6.8. Differences can occur because agencies use different measurement methods and datasets.
The earthquake reached the highest level on Japan’s seismic intensity scale in parts of Kumamoto. Strong shaking damaged roads, houses and public infrastructure across communities near the epicenter.
The confirmed death toll had risen to 34 by Friday, according to Kumamoto prefectural authorities. Additional people were injured or remained missing as emergency workers entered the period when the likelihood of finding survivors beneath collapsed structures begins to decline sharply.
One of the most severe incidents involved an explosion and partial collapse at a shopping center. The earthquake also toppled a large chimney at a paper factory, damaged traditional homes and caused another section of the stone walls at Kumamoto Castle to collapse.
The historic castle was undergoing extensive restoration after the 2016 Kumamoto earthquakes. Damage to rebuilt or partially restored areas illustrates how recovery from one major disaster can remain unfinished when another arrives.
Aftershocks continued during the rescue operation, increasing the danger for emergency personnel entering unstable buildings. They also discouraged residents from returning to damaged homes, even when those structures remained standing.
Thousands of survivors moved into public shelters or slept inside vehicles. Some families chose cars because evacuation centers were crowded, while others feared that another strong tremor could collapse weakened buildings.
Extreme heat added another emergency. High summer temperatures can quickly create dehydration, heat exhaustion and medical complications, particularly for older people, children and residents sleeping in vehicles without reliable cooling.
Apple Donation Joins an Expanding Corporate Response
The Apple donation places the company among several technology and entertainment businesses providing money for Japan earthquake relief and reconstruction.
The Pokémon Company announced a contribution of 100 million yen to Kumamoto Prefecture, the Japanese Red Cross and other support organizations. The funding is intended to assist people affected by the earthquake and support restoration across damaged areas.
Sony committed 50 million yen and began collecting additional employee donations that the company will match. Its contribution is being directed toward the Japanese Red Cross and an emergency fund operated with Save the Children.
Sony has a direct industrial connection to Kumamoto through its semiconductor operations. The company described the prefecture as a community with which it has developed deep ties since establishing the Kumamoto Technology Center in 2001.
Apple also maintains substantial commercial and cultural connections with Japan through its retail stores, developer community, suppliers and customers. Cook has visited the country repeatedly and has met Japanese developers, musicians, educators and manufacturing partners during previous trips.
The amount behind Apple’s latest commitment may never be made public. The absence of a disclosed figure prevents direct comparison with other corporate donations, and it also leaves unanswered which organizations will distribute the money.
Relief contributions can support several different stages of a disaster response. Immediate funding may pay for water, food, temporary shelter, medical care and emergency equipment. Later funding can help repair homes, restore community services and assist families whose employment disappeared with damaged businesses.
The timing of Apple’s donation places it during the immediate emergency rather than after the complete scale of destruction has been calculated. Recovery costs will continue changing as inspectors determine which buildings can be repaired and which must be demolished.
Kumamoto Faces Another Long Recovery
Kumamoto experienced a destructive sequence of earthquakes in April 2016. Those events killed dozens of people, damaged or destroyed more than 100,000 buildings and displaced large numbers of residents.
Apple responded at the time by allowing customers to send donations to the Japanese Red Cross through iTunes. The system offered preset contribution amounts that were transferred without Apple retaining a percentage.
The company has used similar responses after earthquakes, hurricanes, floods and wildfires in several countries. Cook usually announces the commitment publicly while leaving the amount and distribution arrangements private.
Apple has previously contributed directly to relief organizations and has sometimes provided matching programs for employee donations. It has not announced whether employee matching or a customer donation channel will accompany the current Japan earthquake relief commitment.
The 2026 disaster presents different immediate pressures from the 2016 earthquakes because it arrived during intense summer heat. Shelter capacity alone does not solve the problem when buildings lack sufficient cooling, water or private areas for medically vulnerable residents.
Japanese authorities deployed Self-Defense Force personnel and emergency teams to support local rescuers. Prime Minister Sanae Takaichi instructed agencies to prioritize the protection of life, collect information quickly and coordinate assistance across national and local government.
Electricity had been restored by Friday evening, according to the local power company, but water remained a serious concern. Kumamoto authorities said nearly 80,000 homes were still without running water, creating demand for bottled supplies, mobile water stations and sanitation support.
A water interruption affects more than drinking. Hospitals, shelters, restaurants and homes need reliable supplies for hygiene, food preparation and medical care. Restoration can take longer than electricity because ruptured pipes must be located, isolated and repaired across damaged roads and neighborhoods.
Apple Donation Arrives Before the Full Damage Is Known
Apple’s announcement communicates support without defining how the money will be used. The effectiveness of the contribution will depend on the recipient, timing and ability to direct funding toward needs that remain after the first wave of public attention passes.
Immediate rescue work receives the greatest visibility, but rebuilding homes and local businesses can continue for years. Families may need temporary housing long after shelters close, while damaged schools, transportation routes and medical facilities require larger reconstruction programs.
Private donations cannot replace government disaster funding. They can provide additional flexibility for relief groups that need to purchase supplies quickly or reach people whose circumstances do not fit standard assistance programs.
The continuing aftershocks also make damage assessments provisional. A building considered stable after the first inspection may require another examination, while rain or additional shaking can affect weakened slopes and structures.
Apple has not indicated whether it will open a public donation channel through the App Store or another service. Its current response is limited to the corporate contribution confirmed by Cook.
The next stage of Japan earthquake relief will move from search operations toward shelter support, structural inspections and temporary housing. In Kumamoto, the most urgent calculation is already measured beyond financial totals: nearly 80,000 homes need running water restored while residents endure the hottest weeks of the Japanese summer.
A delivery in Wilmington, N.C., this month. Heat is linked to hundreds of workplace deaths each year, but labor groups say the true toll is unknown because heat-related illnesses are not properly tracked or reported.
Michael Dell, the founder of Dell Technologies Inc., shared his company’s quarterly earnings report dated July 31, 1984, saying, “This one page changed my life.” The billionaire said on his X post that the numbers on that piece of paper convinced his parents that they didn’t need to go back to college. He started the company in 1984, originally known as PC’s Limited, in his dorm room at the University of Texas at Austin, upgrading PCs and building clones of IBM PCs from stock parts.
As we see from his X post below, his venture seemed to be successful from the get-go, with Dell selling almost a million dollars’ worth of parts and computers, which resulted in a net income of $134,762.75 for just one quarter — equal to $433,150.05 in 2026 dollars. This is an achievement for any startup not backed by millions of dollars, much less by a 19-year-old college freshman backed by just $1,000, with the investment returning 13,500% in less than a year.
Dell went public four years after it was founded, but after a quarter of a century of being listed on the stock market, Michael Dell and Silver Lake Partners decided to take the company private again in 2013 in a $24.9 billion deal as it struggled with the rise of smartphones and tablets. After five years without mandatory quarterly reports, Dell decided to go public again, and it currently has a market capitalization of around $261.92 billion.
This one page changed my life.42 years ago today, it convinced my parents I shouldn't go back to college.I started by upgrading PCs from a dorm room.Today @Dell is helping build the infrastructure that powers AI, from the edge to some of the world's largest AI factories.… pic.twitter.com/OF3KTMrBeHJuly 31, 2026
The fledgling dorm-room startup has turned from a niche supplier of off-brand IBM-compatible computers into a massive tech giant. It owns iconic computer brands like Alienware and XPS, and has also jumped on the AI bandwagon, supplying servers to hyperscalers and data centers. Its latest income statement also lists total net revenue of $43 billion and a net income of $3.4 billion. Dell’s risk in 1984 also paid handsomely for him. He’s currently the fifth richest person on Forbes’ real-time billionaires list, with a net worth of $229.2 billion.
The computer company has also had its fair share of controversies. This includes an SEC investigation into improper accounting practices in 2005, a lawsuit and massive recall related to laptop batteries catching fire in 2007, and a security vulnerability in 2015 that could have exposed customer data to bad actors. Despite all that, the company continues to thrive today and release new products like the $699 XPS 13 and an affordable OLED gaming monitor in the Alienware AW3426DW. Dell has made a significant impact on PCs, laptops, and other systems for gaming, productivity, enterprise, and more.
OpenAI family of devices plans are no longer limited to an experimental gadget hidden inside a design studio. OpenAI President Greg Brockman has confirmed that the company’s first consumer device will begin a broader series intended to reconsider how people interact with artificial intelligence.
The confirmation gives OpenAI’s hardware strategy a clearer shape without revealing the first product itself. Brockman said the company is not ready to discuss the device in detail, but described it as the first in a series that will rethink what devices should be when AI can understand language, observe context and complete tasks.
That ambition extends well beyond placing the ChatGPT app on another piece of hardware. OpenAI wants to reduce the menus, buttons, model selectors and separate applications that currently stand between a person and an AI assistant.
For Apple, Google and other established platform owners, the implication is significant. ChatGPT currently reaches consumers through devices and operating systems controlled by other companies. An OpenAI-designed product would give the company direct control over the microphones, cameras, sensors, interface and account experience through which its models interact with people. 56000
OpenAI Family of Devices Begins With io
OpenAI’s move into consumer hardware accelerated in 2025 when it acquired io Products in a transaction valued at approximately $6.5 billion.
The startup had been founded by former Apple design chief Jony Ive alongside Scott Cannon, Evans Hankey and Tang Tan. Its team included hardware engineers, designers, manufacturing specialists and product developers, many of whom had spent years working together at Apple.
OpenAI and Ive had already been collaborating before the acquisition. Their early ideas developed into physical designs, convincing the partners that they needed a dedicated company capable of engineering and manufacturing complete products rather than another software prototype.
The io team officially merged with OpenAI in July 2025. Ive and his design collective LoveFrom remained independent while assuming extensive design and creative responsibilities across OpenAI.
The structure combines OpenAI’s models and software research with a group experienced in turning new interface concepts into mass-produced consumer products. Ive’s previous work helped shape the iMac, iPod, iPhone, iPad, Apple Watch and other devices that established Apple’s modern design identity.
OpenAI has continued recruiting hardware expertise from Apple. Paul Meade, who led hardware development for Apple Vision Pro and worked on the company’s smart-glasses efforts, reportedly joined OpenAI’s hardware organization in 2026.
OpenAI also placed product-development veteran Peter Welinder in a leadership role connected to the io division. The resulting organization is not structured like a small accessory project. It is being assembled to develop products, create manufacturing relationships and support more than one form factor.
Image Credit: Google
The First Device Remains Unannounced
OpenAI has not publicly confirmed the name, appearance, price or specifications of its first device. It has also not presented the product as a smartphone, pair of glasses, wearable pin or conventional smart speaker.
Recent reporting describes a portable, screen-free device designed primarily for use inside the home. The reported product resembles a compact speaker but includes a rechargeable battery, allowing it to move between rooms rather than remain attached to one location.
A camera and additional sensors would help the device understand its surroundings. Mechanical elements could allow parts of it to move, creating a more expressive physical presence than a stationary speaker waiting for a wake word.
The reported design would rely heavily on OpenAI’s latest voice technology. Instead of requiring a person to wait for the assistant to finish speaking, the system could listen and respond more naturally during overlapping conversation. Access to personal information, including messages or email when authorized, could give it enough context to handle requests rather than merely answer questions.
These details remain reported plans rather than announced specifications. OpenAI could change the hardware, features or release schedule before introducing the product.
The company is reportedly targeting a presentation during 2026 and a commercial release in 2027. Fortune separately reported that the initial design has been finalized, although development of the larger product family continues.
Why OpenAI Wants Hardware of Its Own
ChatGPT already operates across iPhone, iPad, Mac, Android and Windows devices. That wide distribution gives OpenAI access to an enormous audience without requiring it to manufacture screens, batteries or processors.
It also leaves crucial parts of the experience under the control of Apple, Google and Microsoft.
An operating system determines when ChatGPT can use a microphone, whether it can run continuously, how notifications appear and which applications it can control. Platform owners can limit background access, change default-assistant rules or promote their own AI systems more prominently.
Those restrictions matter more as ChatGPT develops from a chatbot into an agent. Answering a question inside an app requires relatively little control over the device. Completing a task across messages, calendars, files, cameras and connected appliances requires deeper access.
OpenAI hardware could be designed around those capabilities from the beginning. The assistant would not need to behave like one application among dozens because it could become the primary interface.
Brockman has described the current ChatGPT interface as too complicated, particularly as new models and tools add more controls. OpenAI’s objective is to make much of that interface disappear.
A successful device could allow someone to describe an outcome instead of opening several applications and completing each step manually. The user might ask the assistant to reorganize a day after a delayed flight, contact the relevant people and adjust reservations. The interface would be the request and the resulting confirmation rather than a sequence of taps.
A Family Creates More Context Than One Gadget
Calling the project a family of devices changes the strategy. One experimental product would need to prove its value independently. A coordinated group could distribute different sensors and functions across the places where people already live and work.
A home device could provide shared access in kitchens and living spaces. A personal wearable could preserve private conversations while moving outside. A future mobile product could handle visual information, navigation and communication without reproducing the application grid of a smartphone.
OpenAI is reportedly developing approximately five hardware concepts, with the screen-free home companion receiving priority. The company has also explored wearables and home robotics, although none of those later products has been announced.
The devices would become more useful if they shared the same ChatGPT identity, memory controls and task history. A request started at home could continue through another product without requiring the user to repeat the people involved, the desired result or the decisions already made.
That continuity is one of the strongest advantages Apple currently receives from controlling a complete ecosystem. An iPhone, Mac, Apple Watch, AirPods and HomePod can exchange information because Apple designs the devices, operating systems and cloud services together.
OpenAI appears to be pursuing a different center of gravity. Instead of making the operating system coordinate applications, it could make the AI assistant coordinate specialized devices.
Image Credit: Dado Ruvic/Reuters
ChatGPT Will Also Expand Through Other Companies’ Hardware
OpenAI’s hardware work does not mean the company intends to reserve ChatGPT for its own products.
Brockman has said OpenAI is interested in deeper integrations with smart glasses, wearables and other devices through its application programming interfaces. The company wants ChatGPT to become an interface available across hardware categories, including products manufactured by third parties.
That creates a two-track strategy. OpenAI can use its own devices to demonstrate the experience it considers ideal while allowing other manufacturers to connect their cameras, microphones and sensors to ChatGPT.
Third-party distribution would help OpenAI reach consumers who do not want another dedicated device. It would also reduce the risk of depending entirely on the success of one hardware launch.
The difficult part will be keeping those experiences consistent. A wearable may have limited battery capacity, a camera may require visible privacy controls, and a speaker may depend on cloud processing when a connection is available. OpenAI will need to define what its assistant can do reliably across products with very different technical limits.
Early AI Hardware Changed the Expectations
The first generation of dedicated AI gadgets established a warning for every company entering this market.
Humane’s AI Pin and the Rabbit R1 attracted attention by promising an alternative to application-based computing. Their launches also exposed problems involving response delays, battery life, incomplete features and tasks that remained easier on a smartphone.
Those products demonstrated that access to a language model does not automatically justify a new object. Consumers need to understand why they should carry, charge and maintain another device when ChatGPT, Gemini and other assistants already operate on phones.
OpenAI has several advantages those earlier companies lacked. It controls one of the most widely used AI services, operates the models behind the interface and has the resources to improve the software after launch. The io acquisition gives it experienced design and manufacturing leadership rather than requiring it to assemble a hardware organization gradually.
The standard will consequently be higher. A well-designed enclosure and natural voice will not be enough if the device cannot complete dependable tasks more efficiently than an iPhone or Android phone.
Apple’s Lawsuit Could Affect the Schedule
OpenAI’s expansion beyond Apple devices has also produced a direct legal confrontation with Apple.
Apple filed a federal lawsuit in July 2026 accusing OpenAI, io and former Apple employees of misappropriating confidential hardware information. The complaint alleges that trade secrets connected to unreleased products, engineering processes and suppliers were taken for the benefit of OpenAI’s hardware business.
OpenAI has denied having any interest in Apple’s trade secrets and said it was unaware of evidence giving the complaint merit. The allegations have not been decided by a court.
Apple is seeking restrictions on the use of its confidential information, along with the return of materials and financial damages. The case could require OpenAI to separate employees from parts of the project, replace suppliers or repeat engineering work if disputed information is found inside the development process.
It does not automatically establish that OpenAI’s reported product copies an Apple device. The first OpenAI design is described as substantially different from Apple’s current hardware, but the legal dispute could still affect when it can be manufactured or sold.
The First Product Will Define the Rules for the Rest
The most important details at OpenAI’s eventual hardware presentation may have little to do with the object’s shape.
A camera-equipped device that learns from activity inside a home will need unmistakable recording indicators, understandable data-retention controls and a simple method for temporarily disabling its sensors. Owners will need to know which information remains on the device, what reaches OpenAI’s servers and which memories can be reviewed or deleted.
OpenAI will also have to explain whether the product requires a paid ChatGPT subscription, how much it can do without an internet connection and whether multiple members of a household receive separate identities. Those choices will determine whether it behaves like a personal assistant, a shared appliance or a new subscription terminal.
Support for messages, calendars, music and connected appliances will require cooperation from outside companies. A device cannot replace frequent phone interactions if it remains unable to enter the services where those interactions occur.
The first model will therefore establish more than OpenAI’s industrial-design language. It will set the privacy, account, subscription and developer rules that every later member of the OpenAI family of devices inherits.
Whether driven by a desire for transparency or to keepOpenAI from hogging the spotlight when it comes to advertising advanced AI models,Anthropic revealed that Claude also hacked into three production systems belonging to unsuspecting targets during cybersecurity capabilities testing. Two of the affected companies didn't know they had been hacked, while a third one is unreachable.
The alleged incidents reportedly happened during the previous quarter and involved several versions of Claude: Opus 4.7, Mythos 5, and "an internal research test model." Similar to what happened when OpenAI Sol hacked into Hugging Face, Anthropic was running Claude through cybersecurity capture-the-flag scenarios where the bot was told to find a piece of information somewhere in its network. Anthropic says there were 141,006 test runs, and the three incidents occurred over six problematic runs. As expected, the tests ran with most AI safeguards disabled.
The problem is, the network was not isolated, a newbie mistake that some might even find suspicious. This was due to an alleged "miscommunication" between Anthropic’s virtualtest lab firm Irregular, which gave the bots full access to the internet. For safety's sake, the Claudes were apparently told they were in an isolated environment, which didn't help much.
The first time, Claude Opus 4.7 had to find a piece of data belonging to an imaginary company. As it turns out, there was actually a real company whose website domain matched the fake one. With internet access, it gained application and infrastructure credentials and grabbed "several hundred rows" of data from a production database.
For two out of four runs where hacking took place, Claude didn't see any problem and "rationalized that the real company must be part of the exercise," but soldiered on. The other two times, it just kept going. Anthropic notes this was the only case of the three where the bot continued to operate after the realization the company actually existed for the aforementioned reason. However, the firm's interpretation is open to discussion.
The second, and potentially more interesting, was a bona fide supply-chain attack, this time perpetrated by Mythos. The fake data available to the bot included an installation script for a hypothetical developer that included installing Python packages. Much like a human would, Claude noticed the obvious attack vector and, once again, due to having internet access, inferred that publishing a booby-trapped package in the PyPI repository would do the trick. Unfortunately, it was the real one that the whole world uses.
In speedrun form for brevity: Claude needed a PyPI account, meaning it needed an email and a phone number. It tried buying one but found itself short of both pockets and funds; but it found another free email provider without that requirement, registered the PyPI account, and uploaded a malware package to PyPI. The package was seemingly only up for one hour but was downloaded and run on 15 systems.
In a twist of irony, one such system belonged to a security vendor that scans PyPI for malware, and lo and behold, promptly failed to find Claude's booby-trap and ran it. Once Claude presumably had remote code execution privileges, it used the credentials it found for further infiltration. The amusing bit is that Claude had no idea this company existed and didn't target it; the downloads just happened because the package was up and live for a short while.
According to Anthropic, the bot did detect it was acting on the real internet and even said that publishing a package like this was "NOT okay." However, it talked itself into believing it was in a test environment as it didn't recognize the real SSL certificates for the connections. It even believed the 2026 calendar date on the systems "proved" the environment was staged. It even recognized the systems that installed the malware as part of the experiment.
As for the third incident, Anthropic isn't saying much, other than Claude scanned 9,000 real live potential alternative targets once it noticed the intended one wasn't reachable. One of them reportedly had a live page with debugging information and was vulnerable to plain ol' SQL injection. Interestingly, this time around, once Claude noticed that the servers it was accessing resided on a cloud environment and not on the local network, it stopped the attack.
For its part, Anthropic recognizes that despite Claude following the instructions for the objectives, the fact that it stopped by itself once it found the target was real in only one of the cases is food for some thought. The firm says it's talking to METR for a third-party review, and it needs to "better co-design evaluation environments."
Oddly enough, Anthropic believes Claude probably wouldn't have gone online "if the prompt had clearly explained which systems were in and out of scope for the evaluation," while also stating the incidents were "closer to a harness and operational failure than a model alignment failure."
Amazon, Google, Meta, and Microsoft have spent more than a trillion dollars on AI infrastructure, including data centers, the chips inside them, and the power needed to run the facilities, since 2023. The Financial Timessaid that these four big companies have already hit $1.1 trillion in capital expenditure based on their latest earnings reports, and that an additional $745 billion is expected to be added to this figure just this year.
“There is basically no end in sight for the growth in capex,” RBC Capital analyst Rishi Jaluria told the publication. “Investors need these companies to toe the tight line between investing in AI and not compromising the things that have made them successful.” This massive investment has upended several other industries — namely electricity prices and memory and storage chips. The massive power demand that data centers have put on the power grid has forced many U.S. utility companies to spend billions of dollars to upgrade their respective infrastructure, which they then passed on to all consumers, not just the big ones that forced the upgrade.
This, alongside other environmental issues, has caused many Americans to push back against data center projects near their communities. The White House instituted the “ratepayer protection pledge” and made AI hyperscalers, utility operators, data center companies, and individual states promise that they will protect the average consumer from electricity cost increases. But so far, no state has taken a step to codify this pledge into law. Oregon actually enacted the POWER Act, which resulted in a 30% increase in the power bill of users that consumed more than 20MW while slashing the bills of residents by 1.3%, but the state did this in 2025, way before President Donald Trump called the tech giants into the White House and told them to “pay their own way.”
The mountains of cash that these tech giants are pouring into AI are also affecting the memory and storage chip industry. Since these AI hyperscalers have a lot of liquidity from investors, they are willing to pay top dollar for the HBM they need to run their data centers. Because of this, it made sense for Micron, Samsung, and SK hynix to prioritize them over DRAM, especially as they can charge a premium for these chips and there are customers who are willing to pay at those prices. This resulted in a shortage of consumer memory that started in 2025 — while this initially affected PC builders and enthusiasts, it has started to affect other industries that require memory as well, including cars and smartphones. Even Apple, which historically had huge sway over its suppliers, was forced to increase prices because of the shortages.
Aside from skewing other industries, the massive CAPEX the big four are going into is alarming some experts, warning that the promises and contracts they’re making are leading to “hidden debt” not listed in their balance sheets. The amount, worth around $1.65 trillion, is annotated in their quarterly financial statements as future obligations that will only come into play as the related asset or service comes online. The current value is 122% of the actual debt reflected on their balance sheets, which could give investors the wrong impression that they have fewer obligations than they actually have.
While the amount of money that the big four are spending on AI might seem dizzyingly high, we must note that these companies are raking in massive amounts of cash quarterly themselves. Microsoft’s latest quarterly revenue is $90 billion, while Meta made $60 billion in the same period. Alphabet (Google) announced revenue of nearly $120 billion, while Amazon made $200 billion. That is a total of nearly $470 billion for these companies in just the last quarter.
Still, that does not mean that they can just keep on spending on AI. For example, even though Google’s cloud business had a revenue of $11 billion last year, its price dropped after it announced that it spent more than it made last quarter — the first time this happened in the 20 years since it went public. Meta is also planning to rent out its AI compute, apparently following in the footsteps of Amazon, Google, and Microsoft, which have growing cloud businesses. However, this announcement caused a drop in its stock price. “They are a bit all over the place,” SLC Management managing director Dec Mullarkey told FT. “For investors it’s no longer growth at any cost; they want to see the spending flowing through to results, like at the Big Three.”
Walking around Dubai, it’s hard to believe a war is still going on in neighboring countries.
No missiles have struck the city, and it was clear during a recent visit that local residents are keeping to their routines. The biggest public worry, as it has been in many parts of the world, is the extreme heat. (The high today is around 106 degrees.)
Dubai, one of seven emirates in the United Arab Emirates (UAE), continues to emerge as a major global tech hub and is on the verge of becoming a major AI powerhouse. Each of the emirates has their own laws and traditions, with Dubai and Abu Dhabi — the UAE capitol — the most prominent.
Other nations recognize the region’s potential and Dubai’s position. The US, for instance, showed interest in currying favor with the UAE by sending a CIA spy to vet the emirate’s top AI firm, paving the way for future chip and AI deals. That outreach, highlighted in a report in The Wall Street Journal, was a hot topic in the local tech community.
These days, Dubai and Abu Dhabi hope to position themselves as hubs where people and companies go for AI. It’s location makes it an excellent place to do business with connections to Asia, Europe and Africa.
Broadly speaking, the UAE wants to be something of a Switzerland for AI, or “a neutral AI corridor between East and West,” Mahmood Abdulla, a regional technology expert, explained in a 2025 LinkedIn entry.
Data center buildouts
While states like New York are putting a moratorium on the construction of data centers in the US, the UAE is moving in the opposite direction; an aggressive AI data center buildout has government backing.
Stargate UAE, a data center project that involves top tech firms such as OpenAI and Oracle, is being built in Abu Dhabi. The city has essentially planned out a business model designed to turn AI into hard cash with a focus on the energy resources that will play a major role in the effort.
The plan is to redirect Abu Dhabi’s vast energy resources — it has up to 100 billion barrels of known oil reserves — to data centers generating AI tokens. Those tokens can then be sold as compute resources to produce revenue.
With oil markets volatile because of ongoing conflicts and the worldwide rise of renewables, pushing energy use to AI data centers might be a more reliable form of revenue long term.
Will it work? That remains to be seen. But unlike the US backlash against data centers construction in many place, a ban here seems unlikely.
The entrepreneurial spirit
Technological innovations from entrepreneurs have been at the core of Dubai’s rapid growth in recent years as a global business center. Here, AI is already quietly woven into daily life, much as it is in China, where AI is already in factories, homes, and infrastructure.
One founder told me that naming his company to include “AI” is more of a US thing. UAE companies focus less on boasting about AI models and superintelligence; they tend to emphasize user experiences.
On a separate track, Dubai is already targeting the launch later this year of robotic air taxis flying from the airport into the city. (That’s ahead of New York City, where electric air taxis are still being tested.)
Still, Dubai is behind the US when it comes to autonomous ground transport. The first autonomous taxis hit Dubai streets just last year, and there are a limited number operating in tourist areas.
A complicating face tor for the area remains the Iran war. Dubai’s Internet City, a hub with buildings belonging to the likes of Microsoft, Oracle and IBM, largely emptied when the war started in late February. Foreign tech workers left, and property prices declined.
But the real estate market is booming as opportunistic investors buy low. Their bet: the US-Iran war won’t stop the UAE’s growth.
Money is flowing into the area in other ways. Heavy tax burdens in Western countries are pushing wealthy founders to move businesses to Dubai’s tax-free environments. And Dubai is opening the door to those with digital nomad and freelance visas. Although visas can cost thousands of dollars a year, lower rent and healthcare costs compared to the US can offset those costs.
Rivals are emerging, too
UAE’s economic rival, Saudi Arabia is also rising as a tech powerhouse. Riyadh has undertaken reforms at a rapid pace to become an attractive place to do business under its Vision 2030 program.
Saudi Arabia requires corporations to have regional headquarters in the country to win government contracts, a policy that challenges Dubai’s status as a regional business hub.
The UAE also relies heavily on immigrants and human labor, which can be both a plus as well as a challenge. There is no pathway for entrepreneurs or long-time tech workers to retire here, which can undermine worker motivations to stay.
Still, the attractive business environment, combined with local infrastructure and a skilled labor force, make this area appealing. As one founder told me, if the US doesn’t want its most skilled immigrants, the UAE will be happy to welcome them with open arms.
As newspapers move online, the buildings that once housed their printing presses need new occupants.
The Minnesota Star Tribune has just sold its old printing plant on the edge of Minneapolis to the aptly named property developer Legacy Investing, which plans to create a new data center there. has found the ideal way to bring them back to life.
This is the second such move by Legacy. It has already bought a building in downtown Minneapolis that it has transformed into a data center for artificial intelligence and cloud computing.
Legacy is taking a small-is-beautiful approach rather than replicating the massive data centers being built for Big Tech firms. Those are the size of small towns and consume huge volumes of water and hundreds of megawatts of power, while the capacity of Legacy’s downtown building is about 30 MW, and it expects the Star Tribune site to host around 20 MW of data center equipment.
The scaled-down approach may well be an attractive option for operators in the future.
Apple will pay even more for memory in the September quarter than it did in the June quarter, CEO Tim Cook told analysts on the company's earnings call on July 30, after memory costs accounted for more than the entire sequential decline in Apple's adjusted gross margin. Cook, speaking from Cupertino on his final call before John Ternus takes over as CEO, called the market "a hundred-year flood on the memory pricing." Apple's consolidated financial statements for the quarter ended June 27 put inventories at $11.09 billion, up 87% year over year, with $5.46 billion of cash consumed building that position over nine months. CFO Kevan Parekh said the benefit Apple gets from that carry-in inventory shrinks after September.
Apple held $5.93 billion of inventory at the end of June 2025 and $5.72 billion at its September fiscal year end, so the $11.09 billion reported for June 27 is a 94% increase in nine months. The cash flow statement puts the same movement at $5.46 billion consumed by inventories over those nine months, against a $1.22 billion release in the year-ago period. Measured against quarterly cost of sales of $54.65 billion, the June position works out to roughly 18.5 days of inventory, up from about 10.7 days a year earlier. Apple has run one of the leanest working capital positions in consumer electronics for two decades, but that has now been flipped on its head.
Parekh told analysts the carry-in inventory partially offset memory costs in the June quarter and will do so again in September, with a decreasing benefit beyond that. Cook said market pricing for memory keeps rising past September and that the effect on Apple's business could grow. Erik Woodring of Morgan Stanley asked whether Apple intends to pursue multi-year long-term agreements with suppliers at pre-agreed prices. Cook answered the second half of the question, on pricing philosophy, and left the agreements question alone.
Company gross margin was 49.3% in the March quarter and 48.1% in June, once the roughly two percentage points of tariff refunds come out, Parekh said, and more than 100% of that 120 basis point decline is explained by memory costs. Apple guided September gross margin to 47% to 48%, including about one percentage point of tariff refunds, putting the adjusted midpoint near 46.5%, and Parekh attributed that step down to the same dynamic. Foreign exchange was a factor in the June quarter but not the main one.
The cost of sales for products rose 8.1% year over year to $47.15 billion, while product revenue increased 18.1% to $78.68 billion, which lifted product gross margin to 40.1% from 34.5%. The Mac and iPad price increases that came in June, the tariff refunds, and the stockpile together more than covered the memory increase in the reported quarter. On the other side of the trade, SK hynix ran a 76% operating margin over the same three months on revenue of 79.32 trillion won and operating profit of 60.54 trillion won, the company said recently, and guided third-quarter DRAM bit shipments up only about 10% sequentially. TrendForce expects conventional DRAM contract prices to rise a further 13% to 18% in the third quarter.
Cook, asked whether Apple's push for sourcing flexibility is about securing volume or protecting its price points, said the DRAM market has three suppliers and that more of them would help on the supply side and perhaps on pricing, then corrected himself to say the pricing effect is unclear. He said Apple is "evaluating all options." The fourth supplier available to him is CXMT, which the Financial Times reported in July that Apple has begun testing DRAM for devices sold in China while lobbying Washington for clearance to use its parts more broadly. Representatives John Moolenaar and George Whitesides wrote to Commerce Secretary Howard Lutnick earlier this month, asking for purchases from CXMT and YMTC to be barred outright, including through allied supply chains. CXMT listed on Shanghai's STAR Market in July.
The unit supply constraints Apple flagged for the September quarter are a separate problem from memory pricing. Cook attributed them to the availability of the advanced process nodes Apple's SoCs are built on, after iPhone and Mac demand ran ahead of the company's plan, and said they'll hit iPhone, Mac, and iPad in September, against Mac primarily in the June quarter. Apple guided September revenue growth of 9% to 11% year over year, down from 16% in the previous quarter.
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