Apple loses $800 million as tariffs take a toll on revenue
- Apple's revenue surged by 10% to $94 billion in the fiscal third quarter despite tariff setbacks.
- The company incurred an $800 million loss from tariffs in the past quarter, predicting further losses in the coming months.
- Despite its profitability, Apple faces significant challenges that may impact future iPhone prices and growth.
In the second quarter of 2025, Apple, based in the United States, reported significant financial results despite facing challenges from tariffs imposed by the Trump administration. The company recorded earnings of $23.4 billion, equating to $1.57 per share, which marks a 9% increase compared to the previous year. Revenue grew by 10% to reach $94 billion, largely propelled by a 13% rise in iPhone sales, generating $44.6 billion. Additionally, Apple's performance in the Chinese market showed a turnaround with a 4% increase in revenue compared to the same quarter last year. However, despite this positive financial outcome, Apple is navigating a turbulent environment. The trade war initiated by former President Donald Trump has inflicted heavy financial burdens, with company executives estimating a nearly $2 billion impact from tariffs, including an $800 million loss in the last quarter alone. CEO Tim Cook highlighted that the ongoing trade fees would impose an additional $1.1 billion toll in the upcoming quarter. Furthermore, the company's stock has experienced a notable decline, dropping 17% this year and erasing roughly $600 billion in shareholder value. Apple's strategy to mitigate the effects of these tariffs includes relocating some of its iPhone manufacturing from China to India. Cook also mentioned that the company is focusing on increasing its chip production within the U.S. as a way to reduce tariff exposure. Despite these measures, there are concerns about the potential for increased iPhone prices, especially with Trump's calls for Apple to shift all production to the U.S., a move experts believe could significantly raise the current average price of iPhones, potentially doubling or even tripling it. Moreover, Apple's transition to artificial intelligence (AI) has not met expectations. The company had announced new AI-driven features for its iPhones, but the anticipated enhancements, particularly for its virtual assistant, Siri, have yet to materialize. This delay in delivering on AI initiatives might hinder the growth of iPhone sales as many potential customers were waiting for upgraded models with enhanced capabilities. Analysts like Thomas Monteiro have expressed skepticism regarding Apple's future in the evolving tech landscape, pointing out the significant investment required for the company to maintain its competitive edge.