- Apple’s market cap has plummeted by $700 billion as its inventory takes a beating within the aftermath of Trump’s “liberation day” tariffs. The corporate is uniquely uncovered to Trump’s tariffs on China, because it produces most of its moneymaker iPhones within the nation. If CEO Tim Prepare dinner can’t safe tariff exemptions for the corporate, as he did in the course of the first Trump administration, the blow may very well be “an entire catastrophe,” in keeping with Wedbush Securities analysts.
Apple’s market cap has collapsed by $700 billion within the days following Trump’s “liberation day” as buyers realized simply how a lot new tariffs will hit the tech large’s greatest moneymaker.
Within the three days after Trump introduced new eye-popping tariffs on U.S. buying and selling companions, Apple inventory plummeted 19%, making it the worst drop over the identical interval since 2001. Since April 2, Apple’s inventory rout has chipped away about $700 billion from its market cap, dropping it to $2.6 trillion as of Monday from about $3.3 trillion final week. From $223 per share final week, Apple’s share value, as of Tuesday, had fallen to $175, and was down 3% in afternoon buying and selling.
The inventory rout comes as analysts warn the corporate’s greatest moneymaker, the iPhone, is at main danger from President Trump’s mega-tariffs due to its provide chain in Asia. Whereas Apple secured exemptions when Trump instituted tariffs throughout his first administration, it’s unclear if CEO Tim Prepare dinner will be capable of safe the identical therapy this time.
“The tariff financial Armageddon unleashed by Trump is an entire catastrophe for Apple given its huge China manufacturing publicity,” Wedbush Securities analysts led by Dan Ives wrote in a Sunday be aware. “In our view, no US tech firm is extra negatively impacted by these tariffs than Apple with 90% of iPhones produced and assembled in China.”
Regardless of Trump’s plan to make use of tariff strain to carry extra manufacturing to the U.S., analysts estimate shifting even one-tenth of Apple’s provide chain to the U.S. would value $30 billion and take three years. If Apple passes elevated prices to customers, the worth of an iPhone may skyrocket.
The worth of Apple’s least expensive iPhone 16 may bounce to $1142 from its introduced price ticket of $799, Reuters reported, citing analysts at Rosenblatt Securities. The worth of an iPhone 16 Professional Max with 1 terabyte of storage may bounce from $1,599 to about $2,300, the analysts estimated.
Apple didn’t instantly reply to Fortune‘s request for remark.
The present tariffs at 32% for Taiwan and 54% for China can be particularly “devastating” to Apple and its prices, the analysts wrote. Trump additionally mentioned Tuesday he would comply with by means of with the extra tariffs of 50% he threatened towards China for retaliating towards america’ preliminary tariff hikes final week. If instituted at midnight as deliberate, cumulative tariffs on China can be round 104%.
Apple has diversified its provide chain away from China in recent times, however Wedbush analysts estimate that together with most iPhones, 50% of Mac merchandise and 75% to 80% of iPads are nonetheless made in China.
The tech large has additionally shifted manufacturing to Vietnam, together with about 90% of its wearables just like the Apple Watch, in keeping with Evercore ISI. But, Apple’s imports to the U.S. from Vietnam will, as of now, even be hit with a 46% tariff.
Apple now produces about 1 in 7 iPhones, or $14 billion value of the merchandise, in India, Bloomberg reported. Imports from India nonetheless face a tariff of 26%.
This story was initially featured on Fortune.com
