Apple investors seek clarity on tariffs, AI strategy as iPhone sales decline

Akash Sriram

Tue, Apr 29, 2025, 4:02 AM 3 min read

By Akash Sriram

(Reuters) - Apple is expected to look a drawstring of questions implicit the delayed roll-out of cardinal AI features and the interaction of the Sino-U.S. tariff standoff connected its business, erstwhile it reports results connected Thursday.

Even arsenic Apple benefited from a unreserved of orders for its precocious launched lower-priced iPhone 16e successful the January-March play up of imaginable tariffs, Wall Street analysts inactive expect the institution volition study a tiny autumn successful iPhone sales. That would people a 2nd consecutive 4th of declines.

The Trump medication has truthful acold spared electronics from tariffs, but Washington has signaled that immoderate levies could travel successful the coming weeks. The uncertainty has sent shares of Apple, which makes 90% of its products successful China, down much than 16% this year, and wiping disconnected implicit $600 cardinal from its marketplace value.

Apple volition effort to mitigate tariffs by shifting accumulation of U.S.-bound iPhones to India, Reuters has reported. Analysts expect the institution to dispersed immoderate of the tariff costs done its proviso chain, portion keeping terms increases to a minimum to debar losing marketplace share.

"Tariffs are a sword of Damocles for Apple – dangling, disruptive and politically charged," said Eric Schiffer, president of Patriarch Organization, a California-based backstage equity steadfast that holds Apple shares.

Unlike rivals specified arsenic Samsung and Alphabet's Google, Apple has besides been dilatory to rotation retired immoderate important AI features it promised past twelvemonth astatine its developer conference.

Improvements to dependable adjunct Siri, a communal inquire from users and investors, person been delayed to 2026, and Apple pulled a commercialized that promoted AI functionalities that were not yet available.

AI features are particularly important successful China, wherever Apple has been losing marketplace stock to home rivals specified arsenic Huawei. Apple has partnered with Alibaba to connection AI services successful China but hasn't offered a timeline for their roll-out.

IPhone shipments successful China fell 9% successful the March quarter, the lone large smartphone shaper to station a diminution successful the region, according to information from probe steadfast IDC.

Despite these challenges, beardown request for the $599 iPhone 16e successful India helped Apple instrumentality the apical spot for planetary smartphone income successful the quarter, according to Counterpoint Research.

Apple's cautious, privacy-first attack to AI deployment has slowed its roll-out and near the institution playing drawback up, said Jacob Bourne, expert astatine eMarketer.

"With tariffs threatening outgo structures, Apple faces unit to determination faster connected AI innovation and proviso concatenation realignment - some of which are superior intensive".