Apple reduced its stock buyback program by $10 billion and warned that global tariffs could add around $900 million to its costs this quarter. CEO Tim Cook explained the company’s strategy to mitigate these impacts by diversifying its supply chain and expanding operations in the United States. Apple is stockpiling products to ensure most U.S. sales this quarter come from devices not manufactured in China. This includes sourcing iPhones from India and other products like iPads, Macs, and Apple Watches from Vietnam.
The company’s decision to scale back share repurchases raised eyebrows among analysts, with some suggesting the move reflects a cautious stance amid global uncertainty. According to Tim Cook, the decision aligns with Apple’s broader effort to safeguard its operations and maintain financial resilience in turbulent times.
Despite concerns, Apple posted strong financial results for the second fiscal quarter, reporting revenue of $95.36 billion and earnings of $1.65 per share, both slightly exceeding analyst expectations. iPhone sales alone brought in $46.84 billion, also above forecasts. Services revenue stood at $26.65 billion, essentially in line with projections. The wearables and accessories segment, including AirPods, generated $7.52 billion in revenue, slightly below estimates.
Sales in Greater China reached $16 billion, slightly above expectations, while Mac and iPad revenues came in at $7.95 billion and $6.40 billion respectively. Entry-level iPads performed particularly well.
Looking ahead, Apple forecasted low-to-mid single-digit revenue growth for the third quarter, in line with market expectations. However, it also predicted a slight dip in gross margins, estimating them between 45.5% and 46.5%, below the consensus of 46.58%.
Apple announced a 4% increase in its quarterly dividend to $0.26 per share. Its board also approved an additional $100 billion for stock repurchases, although this is $10 billion less than the previous year’s authorization.
The company continues to invest heavily in expanding its U.S. footprint, planning $500 billion in spending that includes building chip and server factories across multiple states. Cook emphasized that while this strategy involves significant capital and operational expenses, it’s a necessary evolution to strengthen Apple’s supply chain resilience.
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