Apple Earnings: Better iPhone Sales And Profit Than Expected As It Steps Through Tariff ‘Minefields'

Core Viewpoint - Apple reported strong earnings for the first quarter, but analysts suggest that the results may not provide clarity on the company's long-term value amid ongoing geopolitical tensions [1][3]. Financial Performance - Apple generated $95.4 billion in revenue, exceeding analyst estimates of $94.4 billion, and reported earnings per share of $1.65, compared to forecasts of $1.62 [1]. - The company's sales grew by 5% and profit increased by 8% compared to the first quarter of 2024 [2]. - iPhone sales reached $46.8 billion, surpassing forecasts of $46 billion, while Greater China sales fell to $16 billion, below projections of $17 billion [2]. Shareholder Returns - Apple announced an increase in its quarterly cash dividend to $0.26 per share and approved a $100 billion share buyback program [2]. Market Reaction - Following the earnings report, Apple shares declined nearly 2% in after-hours trading [2]. Geopolitical Context - The earnings report did not account for significant policy changes in April, including tariff adjustments on Chinese smartphone imports, which reduced Apple's projected tariff impact from 29% to 5% [4]. - Apple assembles approximately 90% of its iPhones in China and derived about 17% of its revenue from the Greater China segment in the last fiscal year [4]. Legal Challenges - A federal judge ruled that Apple violated a court order regarding fees on purchases made outside of iOS apps, which could have implications for the company's operations [6].