Feb. 3 (UPI) — Apple shares dropped more than 3% on Monday after President Donald Trump announced 10% tariffs on imports from China, where the tech manufacturer assembles its iPhones and other products.
Apple closed down $7.99, or 3.39%, to end the day at $228.01. The company reported 4% revenue growth last week to $124 billion in the December quarter.
Monday’s stock slide comes amid uncertainty over the potential impact China tariffs could have on Apple’s supply chain and earnings, as well as other companies’ electronics, automobiles and appliances.
“Consumers are going to be clearly worse off,” warned finance and economics professor Sung Won Sohn.
Over the weekend, Trump announced 10% tariffs on China, as well as 25% tariffs on Canada and Mexico, which were scheduled to go into effect Tuesday.
On Monday, Trump spoke with outgoing Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum. The president agreed to pause both countries’ impending tariffs for 30 days as both leaders pledged to reinforce their U.S. borders.
While China’s tariffs are still on track for Tuesday, Trump is scheduled to talk with Chinese President Xi Jinping in the next few days.
As of Monday, Apple had not commented on the tariffs. During Trump’s first administration, the tech giant managed to avoid fees from tariffs by securing waivers for specific products.
“We thought history would repeat. But that’s not the case right now,” Rosenblatt analyst Barton Crockett wrote Monday in a note, saying he suspects Apple would pass any price increases to consumers.
The financial impact Chinese tariffs could have on Apple may also depend on how much production the company can move to locations outside of China.
“As the new tariff is imposed on imports from China, Apple could have its manufacturing partners ramp up production in India and ship to the United States,” according to Bank of America Securities analyst Wamsi Mohan.
“This could also be done for other Apple products that are manufactured in countries including Vietnam, Malaysia, etc.”
