Apple (NASDAQ:AAPL) has shed nearly US$640bn in market value over three trading days as investors react to Donald Trump’s sweeping new tariffs—an economic earthquake that has left the tech giant reeling and raised serious questions about its global manufacturing model.
The company’s shares have fallen 20% in that period, including a 3.7% drop on Monday alone, as concerns mount that Trump’s return to aggressive trade policy will force Apple either to hike prices dramatically or absorb tens of billions in new costs.
Apple is among the most exposed companies in the world to a trade war, with the vast majority of its iPhones and other devices assembled in China, now facing a 54% tariff rate. And while Apple has spent years quietly diversifying production into India, Vietnam, Thailand and Malaysia, those efforts now appear blunted: Trump’s reciprocal tariffs extend to these countries too.
Tariff fallout: stock crash and price hikes
According to UBS analysts, the new tariffs could lift the US retail price of Apple’s top-end iPhone 16 Pro Max by nearly 30%, or US$350, taking it from US$1,199 to as much as US$1,549. Rosenblatt Securities estimates go even higher, suggesting the device could reach US$2,300. Even the lower-tier iPhone 16 Pro—if produced in India—could rise by US$120.
Barclays’ Tim Long warned the company could suffer a 15% hit to earnings per share if it absorbs the costs rather than pass them on. Morgan Stanley estimated the new tariffs could add US$34bn in annual costs. A full reshoring of iPhone manufacturing to the US—deemed logistically impossible—could push prices as high as US$3,500, according to Wedbush analyst Dan Ives.
“After last week’s reciprocal tariff announcement, there becomes very little differentiation in friend-shoring vs. manufacturing in China—if the product is not made in the US, it will be subject to a hefty import tariff,” Morgan Stanley analysts wrote.
Cook’s diplomacy meets hard limits
The sell-off marks the second-largest single-day destruction of value in corporate history—Apple’s 9.3% fall on Thursday erased US$311bn, trailing only Nvidia’s US$600bn rout earlier this year.
Apple CEO Tim Cook had previously managed to carve out exemptions under Trump’s earlier trade policies, using a direct, personal relationship with the president to secure tariff waivers on Apple Watches and other components. Trump once praised Cook’s willingness to “call me directly,” contrasting him with executives who “hire very expensive consultants.”
But this time, the White House has confirmed there will be no exemptions for Apple’s products. The move appears to mark the end of Cook’s delicate balancing act—a strategy that once seemed prescient in a US–China trade war but now falters under Trump’s globalist tariff blitz.
Cook, who joined Apple in 1998 and masterminded its China-based supply chain, has in recent years led a gradual “decoupling” from the region. Apple now makes a portion of iPhones in India and produces AirPods, iPads and Watches in Vietnam. However, experts say this effort to “tariff-hop” has been neutralised.
“Trump’s new policies have thrown a wrench into Apple’s supply chain gears, essentially negating the tariff-hopping that Apple targeted through diversifying production geographies,” said Mark Zetter, an electronics supply chain specialist.
China backlash and global uncertainty
The political implications are also mounting. Apple now finds itself squeezed between rising tariffs in the US and a growing backlash in China, which accounts for around 15% of Apple’s revenue. Reports suggest Chinese authorities have restricted the movement of skilled employees and state media has subtly criticised Apple’s supply chain shifts.
Meanwhile, Trump has hinted that China could gain tariff concessions if it approves the sale of TikTok’s US operations—leaving Apple’s fate potentially entangled in wider geopolitical bargaining.
India, once seen as a key alternative hub, faces a 26% tariff, clouding Cook’s goal of producing a quarter of iPhones there. Vietnam, where Apple and its contractors have invested heavily, has been slapped with a 46% tariff rate.
Nike and the broader impact
Apple isn’t alone. Nike, whose board includes Cook, saw its shares fall 12% on Thursday, wiping more than US$10bn off its market cap. The sportswear company sources roughly half its footwear from Vietnam, with the rest from China, Indonesia, and Cambodia—all now in Trump’s tariff crosshairs.
Analysts believe some of the sell-off stems from political positioning, with Nike seen as a target due to its resistance to Trump’s anti-DEI rhetoric.
What now for Apple?
Apple has pledged to invest US$500bn in the US over the next four years, a move some see as a bid to curry favour with the administration. But that may not be enough. Trump could still demand that Apple bring large-scale iPhone manufacturing back to the US—a prospect experts say is unworkable.
“There is no single location in the Americas that can amass a workforce of 800,000-plus like Foxconn can in China,” said Zetter. “Apple currently has extremely limiting options beyond exemptions and negotiations.”
