• Investing
  • Stock
  • Economy
  • Editor’s Pick
Portfolio Performance Today
Investing

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

by May 3, 2025
by May 3, 2025
AAPL stock, AAPL share price

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

0 comment
0
FacebookTwitterPinterestEmail

previous post
Movement Labs’s MOVE token tumbles 73% as Coinbase delisting follows $38M sell-off
next post
PepeX gains ground on Turbo and Neiro as stronger presale draws $1.83M

Related Posts

GMS stock jumps 29% on takeover interest from...

June 20, 2025

Japan’s rice price surge: what’s driving it and...

June 20, 2025

Foxconn and Nvidia to deploy humanoid robots in...

June 20, 2025

US stocks climb higher at open: Dow jones...

June 20, 2025

Apollo backs £4.5bn loan for delayed Hinkley Point...

June 20, 2025

Audi weighs $4.6 billion US plant amid tariff...

June 20, 2025

Tesla stock gains ahead of robotaxi launch: analyst...

June 20, 2025

BofA raises STOXX 600 target amid resilient global...

June 20, 2025

XRP price stuck under $3: can it finally...

June 20, 2025

Elon Musk confirms Tesla Robotaxi pilot launching in...

June 20, 2025

Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.

By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

Recent Posts

  • The Techno-Industrial Policy Playbook Isn’t Conservative — It’s Central Planning

    June 23, 2025
  • Dollar’s Decline Meets Rising Dedollarization: The Threat Comes from Within

    June 23, 2025
  • OKX eyes US IPO as crypto stock rally fuels listing ambitions

    June 23, 2025
  • Strong fundamentals, shaky chart: Is BAE Systems share price at risk?

    June 23, 2025
  • Rolls-Royce share price has stalled: will the surge resume?

    June 23, 2025
  • Why closing the Strait of Hormuz is a double-edged sword for Iran?

    June 23, 2025

Editors’ Picks

  • 1

    Meta executives eligible for 200% salary bonus under new pay structure

    February 21, 2025
  • 2

    Walmart earnings preview: What to expect before Thursday’s opening bell

    February 20, 2025
  • 3

    New FBI leader Kash Patel tapped to run ATF as acting director

    February 23, 2025
  • 4

    Anthropic’s newly released Claude 3.7 Sonnet can ‘think’ as long as the user wants before giving an answer

    February 25, 2025
  • 5

    Nvidia’s investment in SoundHound wasn’t all that significant after all

    March 1, 2025
  • 6

    Elon Musk says federal employees must fill out productivity reports or resign

    February 23, 2025
  • 7

    Cramer reveals a sub-sector of technology that can withstand Trump tariffs

    March 1, 2025

Categories

  • Economy (1,579)
  • Editor's Pick (164)
  • Investing (185)
  • Stock (1,025)
  • About us
  • Contact us
  • Privacy Policy
  • Terms & Conditions

Copyright © 2025 Portfolioperformancetoday.com All Rights Reserved.

Portfolio Performance Today
  • Investing
  • Stock
  • Economy
  • Editor’s Pick
Portfolio Performance Today
  • Investing
  • Stock
  • Economy
  • Editor’s Pick
Copyright © 2025 Portfolioperformancetoday.com All Rights Reserved.

Read alsox

Air India plane crash: London-bound flight with...

June 12, 2025

China halts Boeing jet deliveries amid rising...

April 15, 2025

GMS stock jumps 29% on takeover interest...

June 20, 2025