Apple announced that most of its devices shipped to the U.S. in the June quarter will be made in India and Vietnam, aiming to ease investor worries about tariffs impacting its business. The company, hit hard by tariffs due to its heavy reliance on Chinese manufacturing, is reportedly accelerating its shift of iPhone assembly for the U.S. market to India, with plans for India to supply the majority of U.S.-bound iPhones by the end of 2026, according to the Wall Street Journal. Other devices like iPads, Macs, Apple Watches, and AirPods will increasingly come from Vietnam.
CEO Tim Cook stated that tariffs could add $900 million to Apple’s costs in the June quarter if current policies persist, with future quarters potentially seeing higher impacts. Despite these challenges, Apple reported a 5% year-over-year sales increase to $95 billion, driven by strong iPhone demand amid the release of a new version.
Cook emphasized Apple’s commitment to diversifying its supply chain, noting the risks of concentrating production in one country and highlighting ongoing efforts to expand manufacturing in India and Vietnam.
“What we learned some time ago was that having everything in one location had too much risk with it,” Cook said.
Apple’s shares have reportedly rebounded significantly after President Trump’s “Liberation Day” tariffs initially triggered a sharp decline, helped by a temporary pause on reciprocal tariffs for smartphones. However, the company still faces duties on imports from China and on those sent from India.
Investors and analysts are awaiting Apple’s public comments on how much of its manufacturing it can shift out of China as tariffs continue to threaten its performance there.
“Apple has spent decades helping to build China into a manufacturing powerhouse, creating enormous assembly lines and factories that house an army of skilled workers that assemble its devices,” according to the Wall Street Journal.
Sales of iPhones have reportedly been struggling in China, however. The Wall Street Journal reports, “sales of the company’s hero product, the iPhone, have stagnated in part because customers in the China region have shifted recently to local brands, causing sales there to fall. The trend could continue as U.S. brands lose their allure amid a protracted trade war. iPhone revenue makes up about half of Apple’s sales.”