The U.S.-China trade fight is becoming more perilous for Apple Inc., as the Trump administration’s tariffs threaten some of its gadget sales in the U.S. and as China weighs retaliatory measures that could target iPhone production there.
The trade tensions are rattling companies in a range of industries, but the technology giant’s heavy dependence on the U.S. and China makes it especially vulnerable as the world’s two-largest powers escalate their economic feud. Because Apple assembles almost all of its gadgets in China, its watches, AirPods and other devices are vulnerable to the Trump administration’s plans to widen the scope of tariffs on Chinese imports—a risk Apple AAPL, -1.77% warned about earlier this month.
That reliance also could make the iPhone and other devices vulnerable if Chinese officials follow through on retaliatory moves to restrict sales of materials, equipment and parts key to U.S. manufacturers—measures The Wall Street Journal on Sunday reported that Beijing is considering.
The timing of the countries’ new measures could be especially bad for Apple, which this week starts shipping two of its three new iPhones and a new smartwatch. Those new devices are expected to help fuel the company’s sales in the final three months of the year, when Christmas shopping helps deliver about a third of Apple’s annual revenue.
An expanded version of this report appears at WSJ.com.
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