Why Apple (AAPL) Shares Are Falling Today

What Happened?

Shares of iPhone and iPad maker Apple (NASDAQ:AAPL) fell 2.8% in the afternoon session after tariffs and trade tensions picked up after President Trump announced plans to impose up to 25% tariffs on iPhones sold in the US unless the company moved manufacturing back home. T. he proposed tariffs underscore a renewed focus on domestic manufacturing. 

Moving production back home on short notice could be a challenge, especially for a company as big as Apple, as it involves redesigning complex production networks, which can be expensive and time-consuming.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Apple? Access our full analysis report here, it’s free.

What The Market Is Telling Us

Apple’s shares are extremely volatile and have had 33 moves greater than 2.5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 11 days ago when the stock gained 5.1% on the news that the major indices popped (Nasdaq +3.4%, S&P 500 +2.5%) in response to the positive outcome of U.S.-China trade negotiations, as both sides agreed to pause some tariffs for 90 days, signaling a potential turning point in ongoing tensions. This rollback cuts U.S. tariffs on Chinese goods to 30% and Chinese tariffs on U.S. imports to 10%, giving companies breathing room to reset inventories and supply chains. 

However, President Trump clarified that tariffs could go "substantially higher" if a full deal with China wasn't reached during the 90-day pause, but not all the way back to the previous levels. Still, the agreement has cooled fears of a prolonged trade war, helping stabilize expectations for global growth and trade flows and fueling renewed optimism. The optimism appeared concentrated in key trade-sensitive sectors, particularly technology, retail, and industrials, as lower tariffs reduce cost pressures and restore cross-border demand. 

In addition, the Wall Street Journal reported that the new generation of iPhones could be more expensive. The next set of iPhones, the iPhone 17 series, is expected to be released in September 2025. Apple announced earlier that trade tariffs could cost up to $900 million. So, raising prices could be part of efforts to keep margins in check. Though, it remained unclear if a price hike would help the company make up any shortfall to its margins or lead to reduced sales as customers opt for cheaper and older models or look to competitors.

Apple is down 19.6% since the beginning of the year, and at $196.10 per share, it is trading 24.3% below its 52-week high of $259.02 from December 2024. Investors who bought $1,000 worth of Apple’s shares 5 years ago would now be looking at an investment worth $2,477.

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