Insightful Word
  • Investing
  • Stock
  • Economy
  • Politics
  • Investing
  • Stock
  • Economy
  • Politics
No Result
View All Result
Insightful Word
No Result
View All Result
Home Politics

Apple (AAPL) shares drop after company flags $900 million tariff hit

admin by admin
May 2, 2025
in Politics
0
Apple (AAPL) shares drop after company flags $900 million tariff hit
0
SHARES
0
VIEWS
Share on FacebookShare on Twitter

Apple shares slid nearly 3% on Friday after the company trimmed its stock buyback program by $10 billion, and warned of an estimated $900 million in additional costs for the current quarter due to trade tariffs imposed under US President Donald Trump’s administration.

Chief Executive Tim Cook said the company is bracing for a significant rise in expenses for the quarter ending in June, assuming no further changes to global tariff rates.

“I’m not sure what will happen with the tariffs … It’s very difficult to predict beyond June,” Cook said.

“Tim Cook did his best to reassure investors on last night’s earnings call, but many likely came away still wanting more clarity about what lies beyond June,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown, adding that the $900 million hit to profit turned out to be smaller than many had feared.

India and Vietnam step in as Apple diversifies supply chain

To blunt the impact of new tariffs, Apple is accelerating its supply chain diversification efforts.

Cook revealed that a majority of iPhones sold in the US this quarter will be manufactured in India, while nearly all US-bound iPads, Mac computers, Apple Watches, and AirPods will originate from Vietnam.

“It looks like Apple is progressing faster than expected with its move to shift production of US phones into the region (India),” Matt said.

Analysts at Wedbush called India Apple’s “life raft supply chain” as the tech giant navigates tariff headwinds.

Despite these moves, Cook noted that China will remain the primary manufacturing base for Apple products sold outside the United States.

Nonetheless, the company has reportedly begun stockpiling US-bound inventory to avoid the full brunt of tariff increases in the near term.

Revenue outlook steady but investor nerves remain

Apple expects its revenue to grow in the low- to mid-single-digit-percentage range for the June quarter, Chief Financial Officer Kevan Parekh said, with gross margins projected between 45.5% and 46.5%.

Operating expenses are forecast between $15.3 billion and $15.5 billion.

Cook was quick to caution that the $900 million tariff-related cost should not be extrapolated to future quarters, citing “certain unique factors” in the June period.

Still, despite Cook’s efforts to calm market anxiety, investors remained cautious.

Apple’s stock has declined about 15% so far this year, underperforming peers such as Microsoft and Alphabet.

Microsoft’s shares are up nearly 1%, while Meta Platforms has fallen just 2.3% over the same period.

“The question for investors is what can replace China for Apple? This is not an easy question to answer and could threaten the long-term trajectory of Apple’s growth plan,” said Kathleen Brooks, research director at XTB.

Apple faces pressure amid Big Tech divergence

While Apple grapples with production shifts and cost pressures, its Big Tech peers reported stronger earnings.

Alphabet, Microsoft, and Meta Platforms all beat quarterly expectations, aided by investments in artificial intelligence. Amazon’s cloud business, however, posted slower-than-expected growth.

In contrast, electronics firms with heavy reliance on hardware and consumer budgets—such as Qualcomm, Samsung Electronics, and Intel—have painted a gloomier picture, similar to Apple’s.

The changing landscape has also weighed on Apple’s valuation.

The company’s 12-month forward price-to-earnings ratio now stands at 27.63, slightly below Microsoft’s 28.64 but above Meta’s 21.48.

The post Apple (AAPL) shares drop after company flags $900 million tariff hit appeared first on Invezz

Previous Post

How billionaire Caltagirone could influence Italy’s banking M&A wave

Next Post

Indian markets open: Sensex holds gains, Nifty above 24,350 ahead of US jobs data

admin

admin

Next Post
Indian markets open: Sensex holds gains, Nifty above 24,350 ahead of US jobs data

Indian markets open: Sensex holds gains, Nifty above 24,350 ahead of US jobs data

Trending News

Trump’s plan to ramp up US gas exports and oil drilling: what to expect

Trump’s plan to ramp up US gas exports and oil drilling: what to expect

November 26, 2024
TikTok CEO sought Musk’s input ahead of Trump administration, WSJ reports

TikTok CEO sought Musk’s input ahead of Trump administration, WSJ reports

November 24, 2024
China central bank conducts first operations under swap facility to bolster stock market

China central bank conducts first operations under swap facility to bolster stock market

October 21, 2024
Subscribe to Insightful Word


    Recent News

    China’s May export growth seen slowing to 5.0% amid trade uncertainty: Reuters poll

    China’s May export growth seen slowing to 5.0% amid trade uncertainty: Reuters poll

    June 6, 2025
    FTSE 100 Index shares of 2025: Rolls-Royce, Fresnillo, BAE, and more

    FTSE 100 Index shares of 2025: Rolls-Royce, Fresnillo, BAE, and more

    June 6, 2025
    Asian stocks end mixed: Hang Seng snaps winning streak, Nikkei jumps 0.5%

    Asian stocks end mixed: Hang Seng snaps winning streak, Nikkei jumps 0.5%

    June 6, 2025
    Starlink reportedly secures key licence in India, moves closer to launching services

    Starlink reportedly secures key licence in India, moves closer to launching services

    June 6, 2025

    Recent News

    China’s May export growth seen slowing to 5.0% amid trade uncertainty: Reuters poll

    China’s May export growth seen slowing to 5.0% amid trade uncertainty: Reuters poll

    June 6, 2025
    FTSE 100 Index shares of 2025: Rolls-Royce, Fresnillo, BAE, and more

    FTSE 100 Index shares of 2025: Rolls-Royce, Fresnillo, BAE, and more

    June 6, 2025

    Latest News

    • China’s May export growth seen slowing to 5.0% amid trade uncertainty: Reuters poll
    • FTSE 100 Index shares of 2025: Rolls-Royce, Fresnillo, BAE, and more
    • Asian stocks end mixed: Hang Seng snaps winning streak, Nikkei jumps 0.5%

    About Insightful Word

    • Contacts
    • Cookie Notice
    • Privacy Policy
    • Terms of Service
    • Trading tools
    • Contacts
    • Cookie Notice
    • Privacy Policy
    • Terms of Service
    • Trading tools

    Copyright © 2025 Insightfulword.com. All Rights Reserved.

    No Result
    View All Result
    • Investing
    • Stock
    • Economy
    • Politics

    Copyright © 2025 Insightfulword.com. All Rights Reserved.