Trump tariffs could cost Apple $ 900 million in this quarter

Trump tariffs could cost Apple $ 900 million in this quarter

CNN-Apple boss Tim Cook announced on Thursday that the tariffs could lead to additional costs of $ 900 million for the company this quarter. This happens in the course of the shift in iPhone production for the US market from China to India.

Production of iPhones shifted to India

"If the current global customs tariffs, guidelines and applications do not change in the current quarter and do not add new tariffs, we estimate that the effects of $ 900 million will amount to our costs," said Cook during a conference call at the quarterly figures. Part of iPhone production has been moved to India in recent years, and Cook said that he would expect "the majority of Iphones sold in the USA to have India as a country of origin."

Effects of US customs policy on Apple

The decision of Apple to significantly diversify its global supply chain beyond China illustrates the effects of astronomical tariffs of 145 % on the country, which were imposed under Donald Trump's presidency. According to the Financial Service Firma Wedbus Securities, about 90 % of iPhone production, Apple's most profitable product, remained in China, despite the efforts to move the factories to other countries.

Apple and the challenges in global trade

Although the government of Trump from Trump has smartphones and other electronics products with semiconductors from "mutual" tariffs on China, products that are manufactured in China are still faced with a minimum customs of 20 %, according to Cook. After the conference conference, Apple's shares fell by almost 4 %in post -excessive trading, which reflects the concern of investors about the uncertain view of tariffs and instability in the supply chain.

The importance of a diversified supply chain

"We have a complex supply chain. There are always risks in the supply chain," said Cook. "What we learned some time ago is that everything in one place is associated with too high risks." He emphasized that most Apple products for markets outside the USA will continue to be produced in China. Vietnam will be added to the source for almost all iPads, Macs, Apple Watches and AirPods that are sold in the USA.

Financial results despite tariff challenges

Despite the challenges of the tariffs, Apple reported on solid finances in the period from January to March. The income rose by 5 % to $ 95.4 billion compared to the same period last year, which exceeded the expectations of the analysts. The income from iPhone sales rose by 2 % to $ 46.8 billion.

growth in China under pressure

"In the March district we only had a limited impact on the tariffs because we were able to optimize our supply chain and stocks," said Cook. Nevertheless, the sales figures in the large area of ​​China, including Hong Kong and Taiwan, decreased slightly to $ 16 billion, which corresponds to a decline of about 2 % compared to the previous year. This decline is related to the increasing competition by local smartphone manufacturers in China, the second largest market of Apple.

The pressure on Apple to move production to the USA

The Trump administration urges Apple to move iPhone production to the USA-one goal that analysts classified as almost impossible. Dan Ives, Global Head of Technology Research at WEDBUSH Securities, had previously stated that the price of an iPhone could more than triple if they were produced in the United States. Trump often has Apple's planned $ 500 billion investment , which was announced in February. This investment, which is to be made over the next four years, is part of the efforts to expand the production outside of China and to avoid Trump's tariffs.

focus on AI and training instead of iPhone production

However, this obligation aims to create Series' directions to support Apple Intelligence, the company's AI service, and to found an academy for training companies in manufacturing techniques instead of affecting iPhone production.