Apple feels heat from Trump’s trade turmoil
Apple shares plunged around 3% in trading before the bell on Friday after the firm cut its stock buyback program and CEO Tim Cook flagged a $900 million tariff-related hit to expenses this quarter amid a raging Sino-US trade war.
Apple Inc. is facing fresh operational uncertainty as US President Donald Trump’s shifting tariff policies upend global supply chains and rattle corporate strategies. The tech giant, locked in a tight race with Microsoft for the title of the world’s most valuable company, has responded by stockpiling inventory and scaling back its aggressive capital return strategies.
Inventory Buildup and Buyback Cut Reflect Growing Caution
To hedge against tariff disruptions and wavering consumer confidence, Apple has ramped up inventory levels. In a notable deviation from past trends, the company announced a $100 billion stock buyback—$10 billion less than last year’s $110 billion authorization.
“We found this move a bit of a head-scratcher, as Apple historically either holds or increases its buyback authorization,” said Angelo Zino, equity analyst at CFRA Research, adding that the pullback likely signals a cautious stance on cash preservation.
Tariff Uncertainty and a Strategic Supply Chain Pivot
As the Trump administration wavers on the imposition of broad tariffs, Apple had braced for potential iPhone price hikes—a risk analysts warned could dent demand. A last-minute exemption for consumer electronics provided short-term relief, but the broader trade policy remains in flux.
CEO Tim Cook confirmed that Apple is accelerating its supply chain diversification, shifting more of its iPhone assembly operations to India, with most U.S.-bound devices now set to originate there instead of China.
Financial Performance: Solid but Cautious Outlook
Apple posted quarterly sales of $95.36 billion and earnings of $1.65 per share, just ahead of Wall Street expectations. The company projected low-to-mid single-digit revenue growth for the coming quarter, in line with muted analyst forecasts.
In China, Apple generated $16 billion in revenue, slightly beating estimates. However, its market share continues to feel pressure from local rival Huawei and a sluggish rollout of AI features, which have dampened demand in the region.