With Tim Cook resigning, Apple has reported record sales but is expected to face a chip shortage.

Apple reported a record quarter on Thursday. But outgoing CEO Tim Cook warned that a storm was gathering in the form of memory chip supply issues that could impact the business in the near future.

“Today, Apple is proud to report our best March quarter ever, with $111.2 billion in revenue and double-digit growth across all geographic segments,” Cook said during Thursday’s earnings call. “iPhone achieved record sales in the March quarter, driven by tremendous demand for the iPhone 17 lineup.”

Less optimistically, Cook relayed that Apple spent more on memory chips in March than in the previous quarter, but that the company’s costs were offset by its ability to sell stockpiled inventory. But he warned that “memory costs are expected to rise significantly” after June, which “could have an increasingly significant impact” on businesses.

Cook was referring to a phenomenon commonly referred to as “RAMageddon.” This is a trend in which the AI ​​industry is consuming memory chips at alarming rates, triggering shortages. This is driving up hardware prices. Apple is primarily a hardware company, so this isn’t good news when it comes to its core products.

In particular, the chip shortage affected the iPhone. Despite the strong sales figures Apple announced on Thursday, it was previously reported that RAM costs had quadrupled, impacting phone production costs and putting Apple’s new CEO John Ternus in an unenviable position.

One possible outcome could be Apple raising the price of the iPhone. “There’s a little bit of lack of flexibility in the supply chain right now to get more parts,” Cook told Reuters on Thursday.

Ternus, who previously served as Apple’s senior vice president of hardware engineering, attended Thursday’s earnings call and praised Cook. “In my opinion, Tim is one of the greatest business leaders of all time. It is a tremendous honor to take on the role of CEO and it means a great deal to me to have Tim’s trust and confidence,” said Ternus.

He will certainly have his fill when he starts on September 1st. But he will still rely on Cook’s supply chain experience for the time being. Cook serves as chairman.