The tariffs announced by US President Donald Trump last week have hurt a number of major tech companies, including Apple, Meta, Amazon and Microsoft, with analysts saying their executives did not expect the tariffs to be so damaging.
The tariffs announced by US President Donald Trump last week have hurt a number of major tech companies, including Apple, Meta, Amazon and Microsoft, with analysts saying their executives did not expect the tariffs to be so damaging.
Apple has previously been reported to have tried to move some of its manufacturing to countries like India, Vietnam, and Thailand. But with Donald Trump’s tariff policies, its efforts would be in vain, even if the company moved production to an island with penguins.
Apple shares fell about 7,5% and fell nearly 16 points after the tariffs were announced. Morgan Stanley estimates that Trump’s tariffs will cut Apple’s profits by $33 billion.
Apple has yet to comment on the tariffs or its future plans, but the company is undoubtedly working behind the scenes to calculate their impact.
Analyst Mark Gurman believes Apple will employ a mixed strategy to mitigate the impact. He says the company will likely pressure its component suppliers and manufacturing partners to lower prices. Apple could also absorb some increased costs, which would offset its typical hardware profit margin of about 45%.
Tesla is facing problems across Europe as sales in key markets have plummeted. The company is also battling public criticism, with boycotts, over Tesla CEO Elon Musk’s political leanings and pro-Trump sentiment, which are further hurting its performance.
Tesla shares have fallen more than 50% since peaking in mid-December 2024, one of their worst periods since a dramatic drop in late 2022.
Tesla shares fell 9,15% to 239.25 last week. The shares fell another 7% in pre-market trading on Monday, April 7.
«In our opinion, the biggest concern is Tesla’s success in China, as this key region is the linchpin of Tesla’s future success. The negative impact of Trump’s tariff policies in China and his connection to Musk will be hard to overstate, and it will further encourage Chinese consumers to buy domestic electric vehicles such as BYD (BYDDF), Nio (NIO), Xpeng (XPEV) and others», — said Wedbush analyst Dan Ives.
SpaceX has complained that operating costs for its Starlink satellite internet service are increasing due to trade barriers abroad, while foreign competitors do not face such costs in the US.
The letter states that the company must pay foreign governments import duties on Starlink satellite internet equipment, as well as other fees that «significantly increase the cost of operating in these countries — artificially.»
«Import duties paid in several countries significantly increase the cost of Starlink products in those countries, despite the fact that the United States imposes virtually no duties on similar foreign products imported into the United States to serve customers here,» Matt Dunn, SpaceX’s senior director of global business and government relations, wrote in the letter.
While semiconductors themselves are exempt from Trump’s new tariffs, they mostly enter the U.S. through finished products such as servers and computers, which are subject to tariffs. As a result, Nvidia shares lost nearly 15% last week. They were down about 3% in early trading on Monday.
Despite this, analysts note that they are still currently trading at about 20 times forward earnings, close to ten-year lows.
Nvidia’s supply chain is largely concentrated in the Asia-Pacific region, with its chip production heavily reliant on factories like Taiwan Semiconductor Manufacturing Company (TSM).
CEO Jensen Huang doesn’t think the tariffs will have a significant impact on the company’s prospects, and suggested Nvidia will eventually move more production out of Taiwan. «The tariffs will have little impact on us in the short term», — he said.
HP shares fell 13% and Dell shares fell 15% last week. According to Morgan Stanley, many hardware companies were already under pressure due to political uncertainty, deteriorating business and consumer sentiment, and a slowdown in corporate spending on hardware.
Analysts believe that Trump’s trade war will exacerbate these adverse factors, given that most equipment manufacturers that have diversified production outside of China will now face import tariffs of at least 25% (and even 54%).
Dell and HP, along with other hardware makers that rely heavily on international manufacturing, saw their shares fall 8%, 15% and 10%, respectively.
«For DELL and HPQ, the additional cost of tariffs could account for almost all of their expected net income in 2025,» Morgan Stanley analyst Eric Woodring added in a note to investors.
Amazon shares fell 16% last week as a large portion of Amazon’s sales come from third-party sellers, many of whom source their products from China. The recently implemented tariffs, which include a 34% tariff on Chinese imports, are expected to drive up the cost of those goods. Such increases could force sellers to either raise prices, potentially reducing consumer demand, or cover costs, which could reduce their profit margins.
The pressure is increasing with the planned elimination of the de minimis exemption, which currently allows packages worth up to $800 to be imported into the US duty-free. For Amazon, this means trouble.
Additionally, Amazon’s extensive global supply chain is vulnerable to disruptions caused by tariffs. Rising costs for imported goods and potential retaliation from other countries could lead to higher operating costs. This could force Amazon to adjust its pricing strategies, potentially making its offerings less attractive to price-sensitive consumers.
However, analysts believe the company has enough leverage to adjust for the negative effects of tariffs and has already proven this in 2018 and 2019 during the first round of tariffs of the then Trump presidency.
The corporation, which primarily produces software rather than hardware, was somewhat less affected by Trump’s tariffs, with its shares falling 6%. But that didn’t much reassure former Microsoft CEO Steve Ballmer, who has a stake in the company.
«For me, as a Microsoft shareholder, these things are not good… I studied economics enough in college to understand that tariffs can really cause some problems,» Ballmer commented on the situation.
Amid the tariffs and a weak quarterly revenue forecast announced in January, Microsoft shares are down for a fifth straight month, their worst performance since 2009. But the company remains a leader in the markets for PC operating systems and productivity software, and its partnership with startup OpenAI has led to successes in cloud computing.
Microsoft currently generates most of its revenue from software, but it also sells Surface computers and Xbox consoles.
Shares of the company, which owns Facebook, Instagram and WhatsApp, fell $52 to $531.62 on April 3 and fell again on April 4. Overall, Meta lost 9% of its market capitalization last week.
Meta is a software-heavy corporation like Microsoft, and it also makes billions in digital advertising like Google. Some of its advertisers are big brands, including Procter & Gamble, L’Oreal, McDonald’s, and Nestle. These companies buy ads on Facebook for so-called brand awareness campaigns.
But the vast majority of Meta advertisers are small and medium-sized businesses. These companies buy a different type of advertising called «direct response advertising».
The impact of tariffs on Meta’s advertising business is simple. With many of its small and medium-sized advertisers from around the world, Trump’s tariffs will instantly make it more expensive for them to sell their products to customers in the United States.
This could lead to a decline in overall consumer purchases and fewer people buying products on Facebook and Instagram, which in turn would lead to brands spending less on advertising on these apps.
The company’s shares fell 2,2% last week. One reason for concern about Google shares is that the chances of a U.S. recession are growing amid Trump’s tariffs. And that could impact digital advertising spending, one of the company’s main sources of revenue.
The tariffs have also led to retaliatory measures against American technology companies. Minutes after Trump’s first round of tariffs against China took effect in early February, the Chinese government announced the launch of an antitrust investigation into Google.
