Today's Edition
SAN JOSE (DPA)
Apple expects about $900 million in additional costs in the current quarter due to US President Donald Trump's new import tariff policy, chief executive Tim Cook said on Thursday after releasing second-quarter results.
Cook declined to give guidance beyond the current quarter, telling analysts on an earnings call, "I'm not sure what will happen with the tariffs."
To limit the impact, Apple is redirecting shipments and accelerating efforts to source devices from outside China, as US tariffs of up to 145% apply to goods imported from there.
About half of the iPhones sold in the United States are already made in India and, according to Cook, the majority will soon come from there.
The company also plans to supply nearly all iPads, Mac computers and Apple Watches sold in the US from Vietnam.
Apple has been gradually expanding production in countries like India and Vietnam after Covid-19 lockdowns exposed vulnerabilities in its supply chain. However, most Apple devices are still assembled in massive factories in China.
When asked whether tariffs might lead to higher consumer prices, Cook said Apple would continue to optimize its supply chain and inventory as much as it can.
The company reported better-than-expected sales for its second quarter, as iPhone sales rose despite uncertainty sparked by the tariff threats.
Cook: No panic buying ahead of possible price hikes
Revenue from the iPhone, Apple's flagship product, climbed to $46.8 billion from about $46 billion a year earlier, beating analysts' forecasts by around $1 billion.
Cook told broadcaster CNBC that the company had not seen signs of US consumers rushing purchases ahead of possible price hikes in connection with Trump's tariffs, as feared by some industry experts.
Total revenue rose 5% to $95.4 billion, also exceeding expectations. Net income rose to $24.8 billion from $23.6 billion a year ago.
Apple slightly missed market estimates for its services segment, which includes app sales and subscriptions and its stock slipped as much as 2.5% in after-hours trading.
