Apple, the tech titan behind the iPhone, has hit a rough patch. After four consecutive days of stock price declines starting on April 3, the company’s market value has plummeted by over $770 billion.
This downturn comes on the heels of U.S. President Donald Trump’s announcement of “reciprocal tariffs” on imported goods, a move that has sent shockwaves through global markets. Apple’s reliance on overseas supply chains, especially for product manufacturing, makes it particularly vulnerable.
As of Tuesday’s market close, Apple’s stock had fallen by 23%, reducing its market capitalization to $2.59 trillion. This downturn allowed Microsoft to overtake Apple, becoming the world’s most valuable company with a market value of $2.64 trillion.
The impact of the tariffs isn’t limited to Apple. Global stock markets have suffered, with an estimated $10 trillion wiped off since April 3—a figure surpassing half of the European Union’s GDP. Major U.S. tech giants have collectively lost about $1.65 trillion during this period.
Apple faces a tough decision: should it absorb the additional costs from tariffs or pass them on to consumers? Currently, 90% of Apple’s phones are assembled in China, and analysts estimate that tariffs could cost the company up to $33 billion annually.
If Apple chooses to pass the costs to consumers, the price of the iPhone 16 Pro Max in the U.S. could soar from $1,599 to $2,300, according to Reuters. This significant price hike might deter potential buyers and impact the company’s earnings.
In an effort to mitigate risks, Apple has been diversifying its supply chain. Since Trump’s first term, the company has moved some phone and headphone production to India and shifted assembly of other products like watches and computers to Vietnam, Malaysia, and Thailand.
However, the new tariffs targeting Southeast Asian countries threaten to disrupt these alternative supply lines. Bloomberg reports that shifting production entirely to the U.S. would be extremely challenging, potentially taking at least five years to initiate and doubling the cost of devices.
To cushion the blow, Apple has reportedly expedited shipments from its overseas factories. In late March, the company arranged five flights in three days to airlift iPhones and other products from India to the U.S., aiming to stock up before the tariffs take effect.
The unfolding situation puts Apple at a crossroads, highlighting the intricate ties between global trade policies and the tech industry. Consumers worldwide may soon feel the ripple effects in their wallets and choices.
