Jefferies Flags Margin Risk For Apple iPhone 17

Apple AAPL ticks higher even as Jefferies warns margins are at risk from the iPhone 17 mix and shifting tariff exposure, trimming its price target to $203.07 from $205.16 and keeping Underperform.

Analysts led by Edison Lee argue smartphone tariff exemptions may change. They flag uncertainty around the U.S.-India and U.S.-China frameworks, note an additional 100% now 30% tariff on Chinese imports, and estimate a 5% FY26 EPS hit if Apple must pay a 130% tariff on iPhone 17 units imported from China. A 20% tariff on Vietnam adds more complexity. They also say Apple's $600 billion U.S. investment does not guarantee exemptions and could invite pressure to assemble more iPhones in the U.S., which would weigh on margin.

Momentum is cooling at the high end. Lead times for 17 Pro and 17 Pro Max have shortened across most tracked markets, with zero wait in the U.K. and Germany. The 17 base model looks strongest, with an estimated 36% FY26 mix versus 32% for the 16 base. The 17 Air remains the weakest with zero lead time in all six markets.

a base heavy mix can compress ASPs just as tariff risk rises. Investors will watch holiday demand, lead time trends, and any policy signals that clarify the tariff path.