Apple’s Q1 Profit Surpasses Expectations Amid Tariff Concerns

SAN FRANCISCO: Apple announced its first-quarter earnings on Thursday, exceeding projected figures. However, the company cautioned that US tariffs could negatively impact its finances and disrupt the stability of its supply network.

Apple anticipates incurring $900 million in expenses this quarter due to US tariffs, despite what CEO Tim Cook described as a “contained” initial effect earlier in the year. This statement was made during the earnings conference call.

Cook indicated that “the majority of iPhones sold in the US will originate from India.” He also noted that Apple’s merchandise is presently excluded from the most stringent reciprocal tariffs imposed by the previous administration.

“Estimating the precise impact of tariffs remains challenging, given the uncertainty surrounding potential future policy changes before the quarter concludes,” Cook stated.

“Assuming no alterations to current global tariff rates, policies, and applications for the remainder of the quarter, and barring the introduction of new tariffs, we project a $900 million increase in our costs.”

The ongoing trade disputes have led to significant tariffs imposed by the US on China, with China responding by placing retaliatory barriers on American imports.

Advanced technology products, including smartphones, semiconductors, and computers, have been temporarily shielded from US tariffs.

Although fully assembled smartphones currently benefit from an exemption, tech analyst Rob Enderle pointed out that not all components used in Apple devices are exempt.

“The more components that cross international borders, the higher the cost incurred for the device,” Enderle clarified.

“Ultimately, the tariff situation results in a costly dilemma,” he remarked.

Canalys research manager Le Xuan Chiew noted that Apple had increased its inventory levels in anticipation of the tariffs taking effect.