Background on Apple and Its Current Situation
Apple, the renowned manufacturer of the iPhone and other popular tech products, has experienced a significant drop in its market capitalization. Since reaching its peak on December 26, 2024, the company has lost nearly $1 billion, with its stock value falling by 24.61% from $3.9 trillion to $2.91 trillion as of May 23, 2025. Currently, Apple ranks third in market capitalization globally, trailing behind Microsoft ($3.34 trillion) and NVIDIA (semiconductor giant for AI, $3.20 trillion).
Trade Tensions and Tariff Threats
On a Thursday evening, President Donald Trump issued a warning to Apple via his social media platforms. The message, posted on Truth Social, demanded that Apple produce iPhones in the United States instead of countries like India or China. If Apple fails to comply, Trump threatened to impose tariffs of at least 25% on products manufactured outside the U.S.
President Trump’s Tweet: “For a long time, I’ve been telling Tim Cook of Apple to make iPhones in the USA, not in India or some other place. If they don’t, there will be a 25% tax on their products coming into the U.S. Thanks!”
Following this announcement, Apple’s stock plummeted by 3.02% in the U.S. market, closing at $195.27 per share. This marked the eighth consecutive downward session, bringing the stock to its lowest point in nearly a month.
Apple’s Strategic Considerations
Recent reports suggest that Apple has been contemplating expanding its iPhone production capacity in India. This strategic move aims to circumvent tariffs that would arise if iPhones were manufactured in the U.S., given the ongoing trade war between the world’s two largest economies, the United States and China.
Key Questions and Answers
- Q: Who is Tim Cook, and why is he relevant?
Tim Cook is the CEO of Apple. He has pledged a $500 billion investment in the U.S. over the next four years, including building a factory in Texas, doubling the Advanced Manufacturing Fund of the U.S., and investing in AI and manufacturing academies.
- Q: What tariff threat did President Trump issue to Apple?
President Trump demanded that Apple manufacture iPhones in the U.S., threatening a 25% tariff on products assembled outside the country if they fail to comply.
- Q: How has Apple’s stock value been affected?
Apple’s market capitalization has dropped by nearly $1 billion since its peak, with a 24.61% decline in stock value from $3.9 trillion to $2.91 trillion.
- Q: What is Apple’s current market ranking?
Apple currently ranks third in global market capitalization, behind Microsoft ($3.34 trillion) and NVIDIA ($3.20 trillion).
- Q: What is Apple’s strategy to avoid tariffs?
Apple is considering increasing its iPhone production in India to avoid tariffs that would result from manufacturing iPhones in the U.S., given the ongoing trade tensions between the U.S. and China.
