Although Wall Street had some of its best-performing days of the year after the 2024 presidential election results, that doesn’t ring true for every company. Indeed, Apple (APPL) may be set to struggle, as Bernstein says the company faces increased risks after Donald Trump’s reelection victory this month.
Specifically, the management firm predicts increased difficulty for US-based hardware firms. They project that manufacturers are set to have earnings impacted by some of the policies that the returning president is planning when he once again takes over the Oval Office.
Also Read: Apple: APPL to Take on Meta as They Explore Key Expansion
Apple Earnings to be Affected by Trump Return, Bernstein Warns
Apple has long remained one of the most prominent companies in the United States. Not only was it the first to reach a market cap of $2 trillion and $3 trillion, but it is seeking to outpace Nvidia (NVDA) to be the first to reach the $4 trillion mark. Yet, that could be much more difficult considering the recent political changes.
In a recent research note, Apple was projected to face increased risks under a second Trump term as president by Bernstein. Indeed, they expect Trump’s planned tariff on imports to greatly affect firms that have Chinese exposure. Among them would be the tech juggernaut.
Also Read: Donald Trump Election Win Drives $64B Surge in Net Worth of Worlds Wealthiest
“Companies with the highest exposure to Chinese manufacturing and imports obviously face the highest risk,” Bernstein analyst Tony Sacconnaghi said according to a Yahoo report. Moreover, he noted that the planned tariffs would result in a 13% decline in earnings per share. That is, if the company decided to not increase prices.
Additionally, he noted that, at current volumes, gross profits would decrease another 13%. Sacconaghi also expressed concern over retaliatory policies. Specifically, he noted that China, or another affected nation, could implement tariffs of their own on American companies. That could only increase the risks and make the consequences of business in both nations even more concerning.
Currently, China accounts for 17% of Apple sales. However, they aren’t the only company that would be greatly affected by Trump’s plans. Dell Technologies (DELL) would see earnings lowered by 90% if tariffs were implemented. Altogether, the move could have dire ramifications for the tech sector.
