Apple to report second quarter earnings as tariff uncertainty clouds Big Tech outlook

Apple (AAPL) will report its second quarter earnings after the bell on Thursday as Wall Street looks for early signs of the impacts of President Trump’s tariffs on the iPhone maker. The company is expected to report higher earnings but may be wary of its prospects for the rest of the year.

The second quarter wrapped up in late March, and because Trump held his tariff announcement on April 2, the full breadth of the duties’ effects may not come into view until Apple’s third quarter. Still, Q2 could provide a hint at what to expect in the coming quarters.

Apple stock is down 16% year to date but up 23% over the past 12 months.

Trump initially slapped China-produced goods with a 145% tariff, which could have sent Apple iPhone prices soaring. But Trump has since exempted devices like smartphones and computers from the duties.

Read more about Apple’s stock moves and today’s market action.

According to Reuters, Apple worked to get ahead of the tariffs by shipping 600 tons of iPhones from India to the US. The company is also leaning more heavily on its India operations for devices destined for America because that country faces a lower 26% reciprocal tariff versus China. According to the Financial Times, Apple hopes to eventually source all US iPhones from India.

But the Trump administration hasn’t ruled out the potential for future tariffs on those goods. The White House is currently working on a plan for duties on semiconductors and has said those could also apply to things like smartphones and computers.

Read more: The latest news and updates on Trump’s tariffs

“We don’t think Apple is ‘out-of-the-woods’ yet,” KeyBanc analyst Brandon Nispel wrote in an investor note. “We continue to see consensus expectations as too high for [Apple], particularly looking out to FY26, which calls for an accelerating growth profile.”

For the first quarter, Apple is expected to report earnings per share of $1.62 on revenue of $94.2 billion, according to Bloomberg consensus estimates. That would be an increase from the same period last year, when Apple saw EPS of $1.53 on revenue of $90.7 billion.

But Apple’s iPhone revenue is expected to decline to $45.6 billion in Q2 from $45.9 billion in Q2 last year. Wall Street anticipates the company will make up for the drop with improvements in Mac, iPad, wearables, and services revenue.

For the quarter, the company is expected to see Mac and iPad revenue of $7.7 billion and $6.1 billion, respectively. That’s up from $7.4 billion and $5.5 billion in Q2 2024. Wearables will bring in $8 billion, compared to $7.9 billion last year. Apple’s services revenue is set to come in at $26.7 billion, compared to $23.8 billion in Q2 2024.

Wall Street will be looking to see whether Apple will provide forward guidance for the coming quarters. While Big Tech peer Google (GOOG, GOOGL) offered a relatively positive outlook for its current quarter during its earnings report last week, Intel (INTC), citing trade issues, posted worse-than-expected guidance, sending shares tumbling.

Analysts will also be watching Apple’s revenue out of China during its earnings announcement. Sales in the region have fallen in recent quarters, but analysts expect the trend to flip in Q2, with sales set to improve to $16.8 billion from $16.3 billion.

Analysts have pinned the decline in China revenue on everything from Chinese consumers opting for homegrown devices from the likes of Xiaomi and Huawei to Apple’s struggles to get its Apple Intelligence platform off the ground in the country.

Apple is also dealing with AI delays in the US. The company was expected to launch a generative AI-powered version of its Siri personal assistant before its upcoming WWDC event in June but has pushed that back due to delays in getting the software together.

Email Daniel Howley at dhowley@yahoofinance.com. Follow him on Twitter at @DanielHowley.

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