Apple Stock Drops After Trump Tariff Threat

Market Reaction

Apple shares fell 2.7% Friday after Donald Trump threatened a 25% tariff on iPhones not made in the US.

Trump’s Statement

On Truth Social, Trump said he told Tim Cook that iPhones sold in the US must be made domestically—not in India or elsewhere—or face tariffs.

Apple’s Global Shift

Apple has expanded production to India, Vietnam, and Brazil to reduce reliance on China. Foxconn is investing $1.5B in a new iPhone display plant in Tamil Nadu, India.

Analyst Reactions

Wedbush’s Dan Ives said U.S. iPhone production could raise prices to ~$3,500 and take 5–10 years—calling the idea a “fairy tale.” UBS’s David Vogt estimates a 25% tariff would reduce Apple’s EPS by $0.51 per year.

Impact on Consumers

Apple may raise prices or absorb costs, impacting profit margins. Tim Cook recently said tariffs could add $900M in costs next quarter. While Apple has absorbed these so far, Cook didn’t rule out future price hikes, calling the situation “fluid.”

What’s Next?

It’s unclear if Trump’s threat will become policy, but this time the tone appears more serious.