Apple Shares Surge Despite Weak iPhone Sales After Tariff Delay
Apple has been dealt a wild card after the US administration delayed the implementation of tariffs on Apple products, shortly after their stock surged 4.1% but it was no help for Foxconn the maker of Apple iPhones whose shares fell on weaker demand for Apple iPhones.
The implementation of a further 10% tariff has been delayed until mid-December resulting in Apple’s upcoming iPhone launch and holiday season sales shouldn’t be affected.
As Apple shares rose Foxconn Technology Group’s profit fell 2.5% in the second quarter as its biggest customer, Apple continues to struggle with weak iPhone sales.
Taiwan-based Foxconn, the world’s largest contract electronics maker and the owner of Sharp who are currently in discussions to hand over their Australian consumer electronics and appliances business to a distributor
Revenue for the period rose 7.4% from a year earlier to NT$1.16 trillion.
Apple and Foxconn have been grappling with slowing iPhone sales as customers hold on to smartphones longer and Chinese rivals gain ground in China.
In its latest quarter, iPhone sales dropped 12%, and for the first time since 2013 they didn’t account for most Apple’s revenue, according to eMarketer.
Apple offset the iPhone sales decline with revenue growth in every other area of its business, including iPads and Macs, which Foxconn also assembles.
The trade war between Washington and Beijing has prompted Apple and Foxconn to consider shifting some production away from China. Smartphones are among the Chinese goods that the Trump administration plans to hit with tariffs, though the start date has been delayed to Dec. 15 from Sept. 1.