SAN FRANCISCO (Reuters) -Apple ( AAPL ) on Thursday reported results that narrowly beat Wall Street expectations as consumers stocked up on iPhones amid fears of potential import taxes on its signature device from President Donald Trump.

The Cupertino, California-based company said its sales and profit for the fiscal second quarter ended March 29 were $95.36 billion and $1.65 per share, respectively, compared with analyst estimates of $94.68 billion and $1.63 per share, according to LSEG data. Sales of iPhones were $46.84 billion, compared with estimates of $46.17 billion, according to LSEG data.

Apple ( AAPL ) shares were down 2.4% in after-hours trading after the results were released.

While the results were better than analysts had expected, investors are focused on how tariff concerns will play out in the coming quarter. Apple ( AAPL ) executives will give forecast information on a conference call with investors starting at 5 p.m. EDT.

"The company's proposed manufacturing shift to India raises pressing questions about execution timeline, capacity limitations, and potentially unavoidable cost increases that will shrink margins, be passed to consumers, or have a mix of consequences," Emarketer analyst Jacob Bourne said.

The Trump administration has so far spared electronics from tariffs, but Washington has signaled that some levies could come in the weeks ahead. The uncertainty has sent shares of Apple ( AAPL ), which makes 90% of its products in China, down about 15% this year, wiping off more than $600 billion from its market value.

Microsoft's upbeat forecast took its market capitalization to $3.2 trillion, beating Apple ( AAPL ) to clinch the top spot.

Apple ( AAPL ) will try to mitigate tariffs by shifting production of U.S.-bound iPhones to India, Reuters has reported. Analysts expect the company to spread some of the tariff costs through its supply chain, while keeping price increases to a minimum to avoid losing market share at a time when it faces fierce competition and has experienced delays in rolling out key artificial-intelligence features such as improvements to its Siri voice assistant.

Apple ( AAPL ) CEO Tim Cook told Reuters on Thursday that iPhone inventory levels at the beginning and end of the fiscal second quarter were comparable, meaning there was no large inventory buildup over the period. Cook said handset sales were boosted by the iPhone 16e, the company's $599 mid-market model that contains its first-ever custom modem chip.

The iPhone 16 is Apple's ( AAPL ) most inexpensive model but has a sufficiently powerful processor to run all of the company's newest AI features.

"When you look at the active (iPhone) installed base, it did hit a new high, and did so in every geographic region," Cook told Reuters.

Apple ( AAPL ) said sales in its Greater China segment fell to $16 billion, better than analyst expectations of $15.9 billion, according to data from Visible Alpha. In China, Apple ( AAPL ) has faced especially tough competition from domestic makers such as Huawei and Xiaomi and has not yet rolled out key AI features that were announced nearly a year ago.

Reuters earlier reported that Apple ( AAPL ) has partnered with Alibaba to provide AI features in China, but Apple ( AAPL ) has still not signaled when those features will become available.

Apple ( AAPL ) said sales in its services business were $26.65 billion, compared with estimates of $26.69 billion, according to LSEG data. Cook told Reuters that Apple ( AAPL ) now has more than 1 billion paid subscriptions on its platform.

In Apple's ( AAPL ) accessories and wearables segment, which includes products such as AirPods, revenue was $7.52 billion, compared with estimates of $7.85 billion, according to LSEG.

Sales of iPads and Macs were $6.40 billion and $7.95 billion, respectively, compared with analyst expectations of $6.07 billion and $7.92 billion. Cook said that entry-level iPads performed the best during the quarter.

Apple ( AAPL ) also said it will increase its cash dividend by 4% to 26 cents per share and that its board has authorized an additional $100 billion for its stock buyback program.