Apple Braces for $1.1 Billion Tariff Impact as Production Shifts Accelerate

Apple Inc. anticipates absorbing $1.1 billion in tariff costs this quarter, CEO Tim Cook revealed during Thursday's earnings call. The tech giant already shouldered $800 million in tariffs during its fiscal third quarter, underscoring escalating trade pressures.

Morgan Stanley analysts warn of potential Section 232 tariffs looming over Apple, which could compound existing trade challenges. These national security-linked measures threaten to disrupt supply chains already strained by geopolitical tensions.

The company has responded by diversifying production away from China. Most iPhones sold in the U.S. now originate from India, while Vietnam handles the majority of Mac and accessory manufacturing. This strategic pivot comes as Apple reports record services revenue and a 13% year-over-year iPhone sales increase to $44.58 billion.