Tim Cook, chief executive officer of Apple Inc., during the 60th presidential inauguration in the rotunda of the US Capitol in Washington, DC, US, on Monday, Jan. 20, 2025.
Bloomberg | Getty Images
Apple’s tariff bill has racked up about $1 billion per quarter, but that number should start shrinking following the Supreme Court decision on tariffs.
The Supreme Court on Friday struck down a large chunk of President Donald Trump’s far-reaching tariff agenda, delivering a major rebuke of the president’s key economic policy.
Apple has paid about $3.3 billion in tariffs since Trump initiated them last year.
The iPhone maker’s shares rose about 1% on Friday.
Friday’s decision means Apple could start to see lower production costs and keep more of its margins. The company could also face less pressure to move its production away from China and simplify its supply chain.
Apple declined to comment.
The large tariff costs stem from U.S. import duties on products and components manufactured overseas — especially from China and other Asian partners, like Vietnam and India.
When laying out the plan to handle tariffs in May, CEO Tim Cook said Apple is sourcing half of its iPhones for the U.S. from India and most of its other U.S.-bound products like Macs, AirPods and watches from Vietnam, where tariffs were lower than China’s at the time.
Friday’s decision kills Trump’s tariffs on China-made goods, which were at a 47% rate as of December. It also frees Apple up to produce more U.S.-bound products in China, where most of its products to non-U.S. countries have been sourced, instead of diverting to India and Vietnam.
On earnings calls, Cook has emphasized that Apple is largely absorbing tariff costs to avoid sudden price jumps for customers.
Friday’s ruling means the U.S. government could owe more than $175 billion in refunds to importers after the Supreme Court ruled in a 6-3 decision that tariffs unilaterally imposed by Trump are illegal.
One big question is whether Apple will fight to claw back its tariffs or eat the costs to avoid angering the president.
Addressing the SCOTUS decision in a press conference Friday afternoon, Trump did not commit to refunding U.S. companies that paid the tariffs and said he expects multi-year “litigation” over paying back the money.
The tariffs have tested the relationship between the commander-in-chief and the chief executive of one of the world’s most valuable companies.
The once-solid relationship between Trump and Cook began breaking down over the idea of a U.S.-made iPhone. In May, Trump said he “had a little problem with Tim Cook,” and threatened to slap a 25% tariff on iPhones.
Cook went on the charm offensive.
In August, he appeared at the White House with Trump to announce plans to spend about $600 billion over four years in the U.S. Apple also committed to purchasing parts and expanding its relationship with U.S. suppliers.
Cook presented Trump with a custom, engraved glass plaque featuring a 24-karat gold base.
Last month, Cook attended the White House screening of the “Melania” documentary about first lady Melania Trump.
Despite Friday’s ruling, tariffs are still a moving target, leaving many questions about the impact on companies like Apple.
Hours after the Supreme Court struck down his reciprocal tariffs, the president said he will sign an executive order imposing a new 10% “global tariff,” which he’s invoking under Section 122 of the Trade Act of 1974.
Tariffs using that statute can only last for 150 days, with any extension requiring congressional approval.
The administration is also wielding Section 301 to launch several investigations into potentially unfair trade practices, which could result in additional new tariffs, the president said.
CNBC’s Steve Kovach contributed to this report.
