Apple Faces $900 Million Cost Increase Due to US Tariffs
1min read Apple Inc.'s Chief Executive Officer Tim Cook has revealed that the proposed tariffs on foreign imports by the United States will result in a $900 million increase in the company's costs for the current quarter. This announcement was made during a conference call following the release of the company's quarterly earnings report. Cook stated, "We estimate that the impact will cause our costs to rise by $900 million." This estimate is specific to the current quarter and does not account for potential changes in tariff policies that could affect future quarters.
Cook emphasized that predicting the situation beyond June is challenging due to the uncertainty surrounding potential changes in tariff policies. The company's second fiscal quarter revenue was reported at $95.359 billion, with a year-over-year net income growth of 5%. Apple anticipates that the tariffs will continue to impact its costs, with the potential for further increases if new tariffs are implemented or existing ones are adjusted.
In response to the tariffs, Apple has announced plans to increase its domestic procurement of chips. The company estimates that $19 billion worth of chips will be sourced from the United States this year. This move is part of Apple's strategy to mitigate the impact of tariffs on its supply chain and reduce its reliance on foreign suppliers. The decision to increase domestic procurement is expected to have a positive impact on the U.S. economy, as it will create jobs and stimulate economic growth in the region.
In summary, Apple's CEO Tim Cook has warned that the proposed tariffs on foreign imports by the United States will result in a $900 million increase in the company's costs for the current quarter. The company is taking proactive steps to mitigate the impact of tariffs on its supply chain, including increasing its domestic procurement of chips. However, the uncertainty surrounding potential changes in tariff policies makes it difficult for the company to predict the situation beyond June.
