Fears over tariff price rises prompted panic buying of iPhones
Prior to the earnings conference call, Tim Cook said that Apple saw users buying devices such as the iPhone outside of normal expectations because of concerns that tariffs would force prices to rise.
Tim Cook and Donald Trump in a meeting at the White House in 2018
During Apple's previous earnings call in May 2025, Tim Cook said that there had been some iPhone panic buying ahead of Trump's "reciprocal" tariffs, but that it had not been significant. Now as the company announces its results for the first quarter when the tariffs were in place, the situation has changed.
"On the buying ahead relative to worrying about prices and so forth on tariffs, we did see some evidence of that in the early part of the quarter," Cook told CNBC. "We would estimate it to be about one point of the 10 points of company growth."
He previously said that the tariff impact on Apple during March had been limited because of how the company reorganized its supply and delivery chains. But he noted that at that point, Apple was estimating that tariff cost increases would "add $900 million to our costs."
The wide-ranging, and ever-changing, tariffs are needless, and damaging despite Trump's claims that they are tiny, and that anyway other countries pay them. They do not, it is US companies that pay, and therefore US consumers too, but Apple had been predicted to minimize the impact on buyers for this quarter.
For subsequent quarters, Tim Cook has previously refused to issue guidance because there have been simply too many unknown factors. However, with the new iPhone 17 range launching in September, Apple may have to raise prices.
Mitigating against tariff costs
Cook did also qualify that the "bulk of the tariffs that we paid were the IEEPA tariffs that hit early in the year related to China." IEEPA is the term for Trump's "reciprocal" tariffs, and they vary from country to country, but the highest fees are applied to imports from China.
Apple has minimized this tariff impact by altering how products are distributed. Cook said that the majority of iPhones sold in the US are made in India.
"And the vast majority of other products -- the Mac, and the iPad, and the Apple Watch -- [sold in the US] have a country of origin of Vietnam," he continued. "Still, the products for other international countries, the vast majority of them are coming from China."
Despite the reorganization to source US devices from countries with the lowest tariffs, the situation is not stable. Most recently Trump was reported to be imposing a 25% tariff on goods imported from India -- which means Apple paying eight times as much in import fees as before.
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Comments
All the fear peddling has been much ado about nothing.
"...Cook did comment on the question of whether panic buying had set in among consumers, prior to the tariff announcement. "We don't believe that there was a significant pull forward due to tariffs into the March quarter," he said. "There's no obvious evidence of it."
And then there's the headline for this report on current earnings: "Fears Over Tariff Price Rises Prompted Panic Buying of iPhones" Really? You make it sound like trying to buy toilet paper in the midst of the Covid lockdown. Here are Tim's actual words about this: ""On the buying ahead relative to worrying about prices and so forth on tariffs, we did see some evidence of that in the early part of the quarter," Cook told CNBC. "We would estimate it to be about one point of the 10 points of company growth." Sorry, but can you point me to where he says there was "panic buying?" And that one point out of ten in revenue growth that he pegs to consumers buying ahead reflects all of Apple's revenue categories, not just iPhones. And to give this some further context: Apple's 10% YOY revenue growth amounted to $8.2 billion in actual dollars. That means 1 point of that 10 point increase would be $820 million. So out of $90 billion in total revenue for the quarter, $820 million can be attributed to consumers buying products ahead to avoid tariffs. That's less than 1% of total revenue. If there's any "panic buying" in that number, I'm sure not seeing it. Also, on the earnings call, Apple attributed one-sixth of the 13% increase in iPhone sales to tariff-related buying ahead. In other words, the tariff buying bumped iPhone sales by 2.1%. That's not nothing, but again, where's the panic in that number?
Consumers trying to get ahead of an anticipated price increase in a product by buying now happens all the time. There's no panic in it. It's just about trying to buy smart. But nobody wandered into an Apple Store since April 1 and found empty shelves where there used to be iPhones. This just feels like sensationalism for the sake of it, and then trying to baselessly pin it back on Tim Cook.