Apple Stock Plummets as Trump’s Tariffs Threaten $39.5B Hit

Apple (NASDAQ:AAPL) shares plunged 9.4% on Thursday, erasing $311 billion in market value, following President Trump’s announcement of sweeping new tariffs. This comes despite Apple CEO Tim Cook’s February pledge at the White House to invest $500 billion in the U.S. over the next four years—a move Trump has repeatedly praised as an economic win.

With 85% of iPhones made in China and 15% in India, Apple is now caught in the crossfire. China faces a 54% reciprocal tariff and India a 26% tariff, while Apple sells 33% of its iPhones in the U.S. Analysts say these tariffs could severely impact the tech giant. In 2018, Apple was exempt from similar tariffs, but there’s no confirmation of an exemption this time.

Rosenblatt analyst Barton Crockett estimates Apple could face $39.5 billion in tariff costs, potentially slashing operating profit and EPS by 32% if Apple absorbs the costs. To offset this, prices on Apple products would need to rise by as much as 40%, which could crush demand. Currently, nearly all iPhones, 90% of Macs, 80% of iPads, and 90% of Apple Watches are made in China, with Vietnam producing most of the rest.

Shifting production to the U.S. would be costly and time-consuming. Wedbush analyst Dan Ives says relocating just 10% of Apple’s supply chain from Asia would take three years and cost $30 billion, causing major disruptions. An iPhone built in the U.S. could cost around $3,500, he adds.

Despite the turmoil, Ives remains bullish on Apple, calling the situation a “Category 5 Hurricane” but believing in Apple’s long-term growth once the tariff dust settles.