Tech companies and their CEOs lavished President Trump with praise and cash for his Jan. 20 inauguration in the hopes that doing so would spare them from his policy decisions and improve their standing in his administration.
Apple (AAPL) CEO Tim Cook and OpenAI’s Sam Altman donated $1 million to Trump’s inauguration committee, as did Amazon (AMZN), Google (GOOG, GOOGL), Meta (META), and Microsoft (MSFT).
Since Trump took office, Apple has pledged to invest $500 billion in the US, while Microsoft said it would spend $80 billion. TSMC (TSM), OpenAI, and Oracle (ORCL) plan to spend $500 billion on their Project Stargate AI data centers.
The companies stood to benefit handsomely from a second Trump administration. From immigration reform to cutting government spending and hopes of avoiding antitrust trials, tech companies were high on Trump leading into and in the early weeks of his administration.
But nothing could save them from Trump’s “Liberation Day” tariffs.
As of Wednesday morning, the tech-heavy Nasdaq (^IXIC) was off more than 12%. Shares of Apple collapsed 19% in the past five trading days, while Meta plummeted 11%. Amazon shares were off 10%, Nvidia was down 8.9%, and Google and Microsoft fell 6.9% and 5.1%, respectively.
And things didn’t improve until Trump announced a 90-day pause on tariffs, with the exception of those put on China. In fact, he boosted those from 104% to 125% for a “lack of respect.”
And that’s left Wall Street as unsure as ever.
Apple has some of the highest tariff exposure among tech heavyweights. The company still makes the majority of its iPhones in China, despite efforts to move production to India, among other countries.
And with the Trump administration announcing further duties on goods imported from China on Tuesday, Apple is staring down the prospect of hiking prices on its flagship product or seeing its margins shrink.
During a press briefing on Tuesday, White House press secretary Karoline Leavitt said Trump “believes we have the labor, we have the workforce, we have the resources” to bring iPhone manufacturing to the US.
While moving manufacturing to the US would eliminate tariffs on completed iPhones, the prospect of doing so isn’t exactly easy, and it could mean huge price increases for consumers.
“The reality is it would take 3 years and $30 billion dollars in our estimation to move even 10% of its supply chain from Asia to the US with major disruption in the process,” Wedbush analyst Dan Ives wrote in an investor note Sunday.