Ahead of earnings, Apple under pressure from slow-to-no AI roll-out, U.S. import tariffs

Apple faces challenges heading into Thursday’s earnings, including a late entry into the high-stakes AI race, U.S. import tariffs, and intense competition in China. The consensus on Wall Street anticipates a 4.2% revenue increase for the April-June quarter, for a revenue total of $89.34 billion. However, attention will center on how Apple navigates a shifting landscape where its global supply chain, once a strength, now poses potential risks.
Akash Sriram and Zaheer Kachwala for Reuters:
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U.S. President Donald Trump has targeted the consumer electronics giant for its reliance on overseas manufacturing, threatening 25% tariffs on foreign-made iPhones. To limit the damage, Apple shifted production of U.S.-bound iPhones to India, further drawing Trump’s ire.
The total volume of Indian-made smartphones jumped 240% in the second quarter, largely driven by Apple’s supply chain shift, according to research firm Canalys.
Analysts and investors are now expecting the strategy to help Apple limit the hit from tariffs to well below $900 million it had estimated in May…
Analysts also said Apple, like many other firms, potentially overestimated tariff costs to leave room for an earnings beat. “Most companies we follow have made conservative assumptions by overestimating tariff costs as the goal of management is generally to beat its own guidance,” said Jamie Meyers, senior analyst at Apple shareholder Laffer Tengler Investments.
Doubts still remain over Apple’s prospects in China, where domestic companies including Honor are rolling out smartphones packed with AI features such as generative AI photo editors.
Apple’s cautious approach to AI has fueled concerns it is sitting out what could be the industry’s biggest growth wave in decades. The company was slow to roll out its Apple Intelligence suite, including a ChatGPT integration, while a long-awaited AI upgrade to Siri has been delayed until next year.

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MacDailyNews Take: Apple clearly overestimated tariff costs. Whether doing so was to ensure an earnings beat and/or for another reason or reasons, we’ll never know.
Note, President Trump said just this morning that the United States will impose a 25% tariff on goods imported from India starting on August 1st. In remarks, Trump said India will also face an unspecified penalty on August 1st, but did not elaborate on the amount or reason.

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