Apple (AAPL) Hit by $900 Million Tariff Impact as Supply Chain Shifts to India

Apple (AAPL, Financials) is facing a $900 million tariff hit this quarter and is shifting most U.S.-bound iPhone production to India, CEO Tim Cook said on the latest earnings call.

Revenue for the quarter ended March rose 5% year over year to $95.4 billion, beating analyst expectations. iPhone revenue rose 2% to $46.8 billion. Sales in Greater China fell 2% to $16 billion. Apple shares dropped nearly 4% in after-hours trading.Cook attributed the increased costs to new tariffs imposed by the Trump administration. The company will now produce most iPhones for the U.S. market in India and shift iPads, Macs, Apple Watches, and AirPods for U.S. buyers to Vietnam. Products for non-U.S. markets will continue to be made in China.Trump’s 145% tariffs on China are pushing Apple to overhaul its global supply chain. Analysts warn that making iPhones in the U.S. could triple the price to around $3,500, making the India shift essential to cost management.

Investors will monitor how quickly Apple can implement these production changesand whether further tariffs escalate cost pressures in future quarters.

This article first appeared on GuruFocus.