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Apple’s chief executive Tim Cook has warned that President Donald Trump’s tariffs will increase costs by $ 900 million in the end of June, marking the last sign of how taxes are arranging throughout the corporate America.
Cook said in a call with analysts on Thursday evening that “assuming current global tariff rates … do not change for the quarter balance and no new tariffs are added, we estimate the impact to add $ 900 million to our costs.”
But he said the unsafe tariff environment had made it “very difficult to predict beyond June” how taxes would affect Apple’s costs. Apple’s shares dropped almost 4 percent in the trading on Thursday.
Cook’s remarks are the ultimate sign of how Trump’s taxes for trading partners are already touching the largest US companies. Behemoth Tech Amazon on Thursday added the “Tariffs and Trade Policy” on the list of factors posing a risk to his income, while McDonald’s economic jeans said they were weighing its customers.
Trump on April 2 announced the “reciprocal” steep tariffs in a number of seats. While the US has temporarily excluded intelligent phones from its 125 percent “reciprocal” tariffs in China, Apple is still affected by an existing 20 percent fee for Chinese imports.
Cook noted that in the quarter until the end of June, “we expect most of the iPhone sold in the US will have India as their country of origin.” Vietnam, meanwhile, would supply products MAC, Watch and Airpods to SH.BA, while China will remain responsible for the “overwhelming majority” of sales of products outside SH.BA, he said.
“What we learned some time ago was to have everything in one place was very dangerous with him, and so we have over time, with certain parts of the supply chain, not everyone. Open new supply sources,” Cook said. “You can see the kind that goes on in the future.”
The Financial Times reported last week that Apple plans to move all iPhone’s assembly sold to India as soon as possible. Anyway of the Apple’s supply chain from China, however, endangers the potential political risk in the country, which remains its third largest market after the US and Europe.
Gene Munster at the Deepwater Asset Management said Apple’s inability to predict the effect of tariffs beyond the first half of this year was a concern for investors.
“The annoying question turns out: Does what does this mean for the back half of the year?” He said, adding, “Companydo company will have to deal with it. But Apple has the most difficult problem for anyone.”
Despite the warning, Apple said Thursday that the iPhone demand was strong in early 2025.
The company reported $ 95.4bn for the end of March 29, with 5 percent year per year and slightly more than 94.6bn consensus estimates. Net revenue was $ 24.8 billion, also beating a little estimates of $ 24.5bn and 5 percent in the same period for the previous year.
The iPhone revenue, Apple’s flag product, was $ 46.8BN, with 2 percent year -on -year.
Revenue from China dropped slightly to $ 16BN, below 2.4 percent, reflecting the competitive challenge Apple has faced by local smartphone manufacturers in the last quarters. Its service business, which includes the App Store, ICloud and Apple Pay, continued to show a strong growth, increasing 12 percent to $ 26.6BN.
Apple Kevan Parkh’s leading financial officer told Financial Times that there was no sign of a short -term increase in consumer’s demand to receive April tariffs.
“For the March quarter we do not believe we have seen any strong evidence of attractive demand that influenced our results,” Parkh said.
Apple’s board approved a 4 percent increase in its dividend and up to $ 100 billion in stock purchase, slightly lower than $ 110bn a year earlier.
