Apple (AAPL) users across the U.S. are upgrading their iPhones at record pace. The sudden rush comes after reports of new tariffs, as both the U.S. and China impose duties of up to 34% on each other’s imports. President Trump has further warned of an additional 50% tariff on goods from China, raising concerns about significantly higher iPhone prices.
The new tariffs could increase iPhone production costs by up to 45%, jumping from $580 to $850, according to TechInsights. Many shoppers, worried about rising prices, are making quick purchases before the tariffs take effect and prices go up.
Apple Boosts India Output to Bypass Tariff Hit
To soften the blow, Apple is ramping up its manufacturing in India. It plans to ship 25 million iPhones from India to the U.S. in 2025, which is about 10 million more than usual, according to Bank of America analyst Wamsi Mohan.
This shift aims to reduce Apple’s reliance on Chinese production and avoid tariffs on those goods. Meanwhile, the tech giant is also turning to Vietnam for products like iPads and AirPods, which are now facing tariffs as high as 46%.
Wall Street Reacts to China Risk
Investors aren’t staying calm either. Apple stock is down over 3% in yesterday’s trading session. Moreover, it has dropped nearly 19% within three days, marking its worst fall in over two decades. Analysts say the stock’s tumble reflects worries about supply chain disruptions and shrinking profits. If Apple passes the added costs on to consumers, premium iPhones could become even pricier, possibly denting demand.
And the impact doesn’t stop with Apple. The wider tech industry is also bracing for sharp price hikes on hardware. Analysts estimate that top-tier smartphones, including the iPhone, could see price increases of 21% to 26%, while computers might rise by 28% to 35% due to the newly imposed tariffs.
Is Apple a Buy or Sell Right Now?
Overall, analysts have a Moderate Buy consensus rating on AAPL stock based on 17 Buys, 11 Holds, and four Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average AAPL price target of $248.28 per share implies 36.8% upside potential.
