Is Apple Stock a Buy Now?

Harsh Chauhan, The Motley Fool

Thu, Apr 17, 2025, 6:00 AM 6 min read

Apple (NASDAQ: AAPL) has endured a difficult time on the stock market in 2025 as investors have worried about implications of the Trump administration's tariffs on imports from one of its main manufacturing hubs, China, as well as the reciprocal tariffs on other trade partners where the tech giant manufactures its devices.

Shares of the iPhone maker have pulled back 20% this year as of this writing. However, a recent development suggests that Apple may find some reprieve as imports of smartphones, computers, and other electronic items such as processors and displays have been exempted from the reciprocal tariffs imposed on China.

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Does this mean it is time to capitalize on Apple's dip and buy shares of this tech giant? Let's find out.

The Trump administration initially announced reciprocal tariffs of 125% in addition to the existing 20% duties on imports from China. This would have made iPhones and other consumer electronics items that the company manufactures in China way dearer, which explains why Apple stock dropped when the tariffs were announced.

So the pause on smartphones and other electronic items from China should come as a relief for Apple, which scrambled to ship an estimated 1.5 million iPhones from India to the U.S. last month to beat the tariff deadline. It is worth noting that the U.S. imposed a 26% tariff rate on imports from India, but they have been paused for 90 days.

The bottom line is that Apple seems to be relatively safe from the tariff-related tensions, at least for now. The company would have otherwise faced an adverse impact of $7 billion to $8 billion on iPhone sales, as per Morgan Stanley, even if it managed to shift the majority of its production to India, which was initially in a much lower tariff slab as compared to China.

That's because around 80% of Apple's production capacity reportedly lies in China, according to Evercore ISI. That's way higher than India, where Apple reportedly assembles around 10% to 15% of its iPhones. Meanwhile, countries such as Vietnam, Malaysia, and Thailand are Apple's other production hubs, where it produces iPads, wearable devices, and MacBooks. All these countries were initially in the net of reciprocal tariffs before the pause went into effect.

The company's mass production facilities in the U.S. are almost negligible, which explains why Apple stock has been under pressure. Import duties would have increased the prices of Apple's products, and it would have had to pass on the higher costs to customers by increasing prices. Such a scenario was likely to negatively impact Apple's iPhone sales, which were already under pressure last year.