Apple Projects Tariff Costs Will Hit $1.1b Next Quarter

Tariffs are projected to costs Apple $1.1 cardinal successful nan July-to-September quarter, an uptick from nan erstwhile period, CEO Tim Cook said during nan company’s net telephone pinch investors Thursday. 

Those costs projections, which are based connected existent rates and policies, could extremity up little than expected arsenic they did successful nan erstwhile quarter. Apple incurred astir $800 cardinal of tariff-related costs for nan June quarter, little than nan $900 cardinal estimate the institution shared successful May. 

“If you look astatine iPhone, nan 16 family grew double digits, arsenic opposed to nan 15 family from nan year-ago quarter,” Cook said connected nan call. “And truthful we did group an upgrade grounds .. I deliberation it straight is because of nan spot of nan product.”

Sales of nan iPhone roseate 13% year-over-year and generated $44.5 cardinal successful revenue — nearly half of nan full company’s full gross this quarter, which reached $94 billion. 

Still, tariffs person had an effect and whitethorn proceed to do so, moreover if Apple shifts its manufacturing strategy to countries pinch little tariffs.

Apple devices are chiefly manufactured successful India, China, and Vietnam. Nearly half nan iPhones sold successful nan U.S. are produced successful India, while Macs, iPads, and watches bound for U.S. customers are made successful Vietnam. Both countries are subjected to tariffs of 25% and 20% respectively.