Apple Inc on Thursday forecast revenue well above Wall Street’s estimates, following strong second-quarter results supported by customers buying iPhones early to avoid US President Donald Trump’s tariffs.
Apple chief financial officer Kevan Parekh said the company expects revenue growth for the current quarter to be in the “mid to high single digits,” which exceeded the 3.27 percent growth to US$98.04 billion that analysts expected, LSEG data showed.
The company’s quarterly sales beat expectations by the biggest percentage in at least four years, the data showed.
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However, Apple chief executive officer Tim Cook told analysts during a conference call that those tariffs had cost Apple US$800 million in the second quarter and might add US$1.1 billion in costs to the current quarter.
Apple posted US$94.04 billion of revenue for the quarter ended June 28, up nearly 10 percent from a year earlier and beating analyst expectations of US$89.54 billion, LSEG data showed.
Its earnings per share of US$1.57 topped expectations of US$1.43 per share.
Sales of iPhones, Apple’s best-selling product, were up 13.5 percent to US$44.58 billion, beating analyst expectations of US$40.22 billion.
Apple has been shifting production of products bound for the US, sourcing iPhones from India and other products such as Macs and Apple Watches from Vietnam.
The ultimate tariffs many Apple products could face remain in flux, whiled many of its products are currently exempt. Sales in its Americas, which includes the US and could face tariff impacts, rose 9.3 percent to US$41.2 billion.
In China, where Apple has faced long delays in approval to introduce artificial intelligence (AI) features on its devices, sales were US$15.37 billion, up from the sxame period last year and above expectations of US$15.12 billion, a survey of five analysts from data firm Visible Alpha showed.
That gain was a turnaround from a year-on-year decline in sales in China the first quarter.
In an interview with Reuters, Cook said the company set seasonal records for upgrades of iPhones, Macs and Apple Watches. Apple estimates about 1 percentage point of its 9.6 percent of sales growth in the quarter was attributable to customers making purchases ahead of potential tariffs, he said.
“We saw evidence in the early part of the quarter, specifically, of some pull-ahead related to the tariff announcements,” Cook said, adding that the active user base for iPhones hit a record high in all geographies.
“The pull-forward in demand due to tariffs was somewhat expected given the uncertainty around pricing. However, it’s important to put this in context as this is typically a slow quarter for Apple, yet they still delivered exceptional results with iPhone growth,” Emarketer analyst Jacob Bourne said.
While AI leaders Microsoft and Nvidia have seen their stock market values soar to record highs, Apple’s shares have fallen 17 percent this year.
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