Apple ( (AAPL) ) has fallen by -15.19%. Read on to learn why.
Apple’s stock has plummeted by 15.19% over the past week, a significant decline attributed to the potential impact of President Trump’s newly announced ‘Liberation Day’ tariffs. Analysts from Needham have projected that if Apple does not receive an exemption from these tariffs, its full-year earnings per share could drop by 28%, significantly affecting its fiscal performance. The tariffs, which impose a 54% cost on products made in China and sold in the U.S., pose a severe threat to Apple’s supply chain and overall profitability.
The market’s reaction to the tariffs has been severe, with Apple losing over $315 billion in market value in a single day, marking one of the largest losses for any company in history. The tariffs are seen as a major disruption to the tech industry, with Wedbush Securities describing them as an ‘economic Armageddon.’ The tariffs not only threaten to increase the cost of Apple’s products but also risk derailing the ongoing AI boom and complicating the tech supply chain, which has been optimized for global production at low costs.
Despite the grim outlook, there remains a 30% chance that Apple could receive an exemption from the tariffs, as it did in 2018. This possibility, coupled with Apple’s pledge to invest $500 billion in the U.S., offers a glimmer of hope for investors. Analysts maintain a Moderate Buy consensus on Apple stock, with an average price target suggesting a potential upside. However, the looming threat of tariffs and their broader economic implications continue to cast a shadow over Apple’s immediate future.