📱 Apple, tariffs and margin pressure!
Apple shares $AAPL plummeted by more than 16 %! The reason is the new wave of tariff measures announced by the US administration led by Donald Trump. Flat 10% tariffs on all imports, complemented by targeted, significantly higher tariffs on goods from China, Vietnam, India, Malaysia, Thailand and even the EU, is fundamentally changing the economic environment for global companies.

Of the world's largest companies, tariffs are hitting business the hardest Applewhich concentrates most of its production outside of US.

📦 Here's Apple's production for 2024:
Vietnam: 46% duty, much of its iPads, AirPods and Macs are made here

China: 34% tariff, still a key partner (Foxconn)

India: 26-27% tariff, fast-growing iPhone manufacturing hub

Malaysia and Thailand: 24% and 37% duty - Mac production

Ireland (EU): 20% duty, control centre for Europe

➡️ According to its annual report, Apple produces over 90 % of its production in the regions now affected by the newly announced tariffs.

💬 What does this mean?
Significant price increases. Loss of margins. Pressure to redistribute production. And above all - a very uncomfortable balance between economics and politics.

If Apple doesn't raise end prices, it could lose up to 8-9 % gross margins on each product. Even with a partial shift of production to India, the margin loss is estimated at 5-6 %. Only if Apple were to produce more than 30 % of production in India and the country received a tariff exemption, the margin impact would fall to 1-3 %.

🧭 Options for Apple:
Raise prices (most likely scenario)
Limit discount promotions
Increase pressure on suppliers
Intensify buy-back programmes and monetisation of services

Reducing own costs or retreating from quality is the least likely - Apple is a brand that prides itself on premium status.

📉 Investment view:
This isn't just about Apple, though .Nike, which I wrote about in a recent post, is similarly situated . Overall, this is a warning to all global brands that outsource manufacturing to Asia and build business on optimized supply chains.
Indeed, new tariffs can:
Extend product life cycles (users will keep their iPhones longer because of higher prices)
Reduce the willingness to spend on new models
Disrupt theinvestment plans of companies dependent on cheap production and fast logistics.

But most of all: they can dampen growth in the economy as a whole. According to Deutsche Bank, a wave of tariffs would reduce US GDP growth by 1-1,5 percentage points, significantly increasing the risk of recession.

Apple remains an iconic brand with a huge financial cushion and a loyal customer base. But even this giant is not immune to geopolitical turbulence.

What do you see for the future of Apple? How much will tariffs affect sales of new devices?


Apple is still a quality and great company, but this changes quite a few things. It's entirely possible that that growth will slow down a lot, and if Trump doesn't calm down, it's going to be uncomfortable for Apple in the long run.

This could be a big problem for Apple, and it's possible that the fundamentals will deteriorate significantly. I won't be buying.

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