In This Article:
Apple (AAPL) navigated a quiet quarter with little new product buzz, while keeping tight-lipped on early tariff impacts.
Cleo Capital managing director Sarah Kunst and Neuberger Berman senior research analyst Dan Flax discuss what's next for demand, costs, and the upcoming iPhone cycle.
To watch more expert insights and analysis on the latest market action, check out more Market Domination Overtime here.
the fact that Apple is really obviously trying to navigate this landscape, um, what do you make of of how they appear to be adapting? And also the idea that they don't seem to be seeing any kind of changes in demand as of yet.
I mean, you have to remember that this quarter, uh, the reporting that came out doesn't have a ton of insight into the sort of post-tariff environment. Um, and what little insight it did have, they were not eager to share in detail. Um, and so yeah, I don't know if we're seeing a ton of of that impact yet, but I also think that it is early innings to see how it plays out. Um, this also isn't a huge quarter for sales in general. It's after the holidays. There's not, you know, a ton of really exciting new product right now. Uh, so I I think that they are doing okay, and they certainly don't want to say anything to the contrary.
Dan, I want to bring you in here as well. It does look like Dan, like the stock is extending its decline a bit. We're down nearly four four percent right now in the after hours, but your your thoughts, Dan, on the report, the results, and how Tim Cook is quantifying tariff impact saying June quarter can't estimate precisely, he says, but assuming current rates don't change, impact could add 900 million to cost then.
I think the quarter was decent overall, and certainly over the next, uh, uh, 12 weeks, um, uh, until the next report, uh, the the market's going to to be very, very focused on on how the tariff, um, dynamics play out. But if we think about the next few months, they'll have the developer conference in June where I think they'll preview a little bit more around Apple intelligence, which which certainly needs work. And then, uh, later in the summer, we'll get iPhone 17, and of course we'll have more clarity on tariffs at that point. What I think the market will focus on into the back half is how is that new iPhone 17 product cycle likely to shape up, and can we see better growth as we head into next year? I don't think there's there's anything, um, uh, dramatic that the company can can do given its size, but they have been making changes to their supply chain over the last several years, and that will clearly continue. What I think will matter for the stock into the back half and next year is execution on the new product cycles and ultimately demonstrating that growth is is durable and that can translate into strong earnings and free cash flow as we think about the year ahead.
