Apple stock slightly down as Trump threatens 25% tariffs over iPhones made outside the U.S.

Apple shares are down at market open today after President Trump threatened new tariffs unless the company starts building iPhones in the United States.

Not India, or anyplace else

In a post on TruthSocial, Trump said he had “long ago informed” Tim Cook that iPhones sold in the U.S. should be made domestically, “not India, or anyplace else”. He added that, if that doesn’t happen, Apple will face a 25% tariff.

The company has recently shifted production to India, Vietnam, and Brazil, as part of a broader effort to reduce its reliance on China.

Apple hasn’t responded to the statement, but the market already has: AAPL opened down 2.5% this morning. The stock is now hovering around $196, adding to what had already been a bad week.

If Trump’s threat materializes, the impact won’t stop at Wall Street. A 25% tariff on imported iPhones would almost certainly lead to higher prices for consumers in the U.S., with Apple either passing on the cost or absorbing a significant margin hit. Either scenario could dent profitability and squeeze the company from both ends.

Back on high alert

During Apple’s recent quarterly earnings call on May 1, 2025, CEO Tim Cook addressed concerns about potential iPhone price increases amid escalating U.S. tariffs.

At the time, he acknowledged that tariffs could add approximately $900 million to Apple’s costs in the upcoming quarter. While Cook said the company had been absorbing these costs, he did not rule out future price hikes.

However, Cook noted that the situation was fluid, and future trade policies could necessitate adjustments in pricing strategies. Looks like we might be there.

Whether the threat becomes policy remains to be seen. During Trump’s first term, Apple managed to avoid the worst of his tariffs through behind-the-scenes negotiations. But this time, the tone feels different.