Apple Absorbs $900M Tariff Hit, No Price Increases Planned
Apple recently announced it paid $900 million in tariffs during the last quarter. Despite this significant cost, CEO Tim Cook confirmed no immediate price increases are planned for Apple products.
The company reported strong first-quarter revenue of $95.4 billion and record earnings per share of $1.65, even with the substantial tariff burden. One analyst described the tariff impact as surprisingly low, given Apple's massive scale.
Production Shifts Mitigate Tariff Impact
Cook explained that Apple is strategically shifting production to minimize tariff expenses. iPhone production is increasingly moving to India, while Mac production is expanding in Vietnam. Products made in China are primarily being shipped to customers outside the U.S.
The highest tariff costs impacted AppleCare and accessories, with rates reaching at least 145%, according to Cook.
No Immediate Price Hikes Expected
While the tariff costs are substantial, Cook stated there are no current plans to raise product prices. He emphasized Apple's ongoing efforts to manage costs and influence tariff policy.
“We’re very engaged on the tariff discussions. We believe in engagement and will continue to engage. On the pricing piece, we have nothing to announce today.”
Cook also noted that Apple's core products, including the iPhone, Mac, iPad, Apple Watch, and Vision Pro, are currently exempt from certain global reciprocal tariffs while the Commerce Department investigates the impact of tariffs on semiconductors and related products.
Apple continues to navigate the complexities of international trade and tariff policies, striving to maintain competitive pricing for its products.
Original reporting by TechCrunch and Apple Newsroom.
