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Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Apple CEO Tim Cook has issued a warning about the impact of Donald Trump’s tariffs on the company’s costs. Cook stated that the tariffs could increase costs by $900 million in the quarter ending in June. This is just one example of how the tariffs are affecting corporate America.
During a call with analysts, Cook mentioned that the current global tariff rates could add $900 million to Apple’s costs if they remain unchanged for the rest of the quarter. However, he also highlighted the uncertainty surrounding the tariff environment, making it challenging to predict how the levies will impact Apple’s costs beyond June.
The repercussions of Trump’s tariffs are already being felt by other major companies in the US. Amazon recently revised its profit outlook, citing “tariff and trade policies” as potential risks to its earnings. Similarly, McDonald’s mentioned that economic uncertainties were affecting its customers.
In early April, Trump announced reciprocal tariffs on several countries. While smartphones were temporarily exempted from the steep tariffs on China, Apple is still affected by the existing 20% tariff on Chinese imports. To mitigate the impact, Apple plans to have the majority of iPhones sold in the US manufactured in India, while Vietnam will supply Mac, Watch, and AirPods products for the US market.
Despite the challenges posed by tariffs, Apple reported strong demand for iPhones in early 2025. The company’s revenue for the quarter ending in March was $95.4 billion, up 5% year-on-year, with net income reaching $24.8 billion. iPhone revenue was $46.8 billion, a 2% increase from the previous year.
Although revenue from China declined slightly, Apple’s services business continued to show robust growth, rising 12% to $26.6 billion. The company’s CFO, Kevan Parekh, mentioned that there was no significant increase in consumer demand ahead of the April tariffs.
In terms of China sales, Apple saw an improvement from the previous quarter, with sales remaining steady when adjusted for currency fluctuations. The company’s board approved a 4% increase in dividends and up to $100 billion in share buybacks.
Overall, despite the challenges posed by tariffs and economic uncertainties, Apple remains resilient and continues to innovate and adapt to changing market conditions.
