Apple's quarterly results on Thursday were better than expected as the company trained the impact of President Donald Trump's tariff war with China in a turbulent month.
The company reported revenue of $95.4 billion for the quarter ended March 29, up 5% year-on-year, slightly above the consensus estimate of $94.6 billion. Net income was $24.8 billion, up 5% from estimates a year ago compared with a 5% increase.
The results reflect the period when Trump announced "Liberation Day" tariffs on April 2, which caused Apple stock to slide. The iPhone maker concentrated in Asia to supply chain stores, and was exposed in a large amount of trade war with China.
iPhone revenue from Apple's flagship products was $46.8 billion, up 2% year-on-year.
China's revenue fell slightly to $16 billion, down 2.4%, reflecting the competitive challenges Apple faced in the recent quarter. Its service businesses, including App Store, iCloud and Apple Pay, continue to show strong growth, up 12% to $26.6 billion.
Apple's chief financial officer Kevan Parekh told the Financial Times there is no indication that a short-term increase in consumer demand is to raise tariffs in April.
"In the March quarter, we don't think we've seen any strong evidence that this will affect our results," Parek said.
He said Apple has been "working to optimize supply chains and inventory" this quarter to mitigate the potential impact of tariffs.
Parekh pointed out that in China, the company's performance has improved, with sales "roughly flat" when adjusting for changes in foreign currencies. Last quarter, Apple's Chinese sales fell 11% year-on-year.
Apple stopped providing written guidance figures during the coronavirus pandemic, but investors are eager to understand how trade tensions can impact Apple's business in the coming months and whether it can eventually raise prices.
In its initial response, Apple has begun adding iPhone components in India to avoid the highest tariffs.
Although the government has temporarily exempted smartphones from its "countdown" tariffs on China of 125%, Apple is still affected by the existing 20% tariffs on China.
Further tariffs can also be seen later this year, awaiting results of national security investigations on the results of semiconductors and electronic products that contain them.
Apple's board of directors approved a 4% increase in its dividend to reach up to $100 billion in stock buybacks, consistent with the previous year.