In May 2025, Trump threatened to impose significant tariffs on Apple and Samsung unless they moved production back to the U.S., impacting Apple's pricing strategy.

The trade conflict has escalated under Trump's administration, with tariffs on Chinese goods reaching as high as 145 percent in April 2025.

For the quarter ending May 1, 2025, Apple reported revenue of $95.4 billion, marking a 5% year-over-year increase, and a diluted EPS of $1.65, which is up 8% from the previous year.

The rollout of artificial intelligence (AI) initiatives by Apple and Alibaba in China has faced delays due to regulatory hurdles amid escalating tensions between the United States and China.

This partnership, announced in early 2025, aims to enhance AI services on iPhones in China, which is crucial for Apple as it seeks to counter declining smartphone sales.

However, Apple has been slow to introduce its 'Apple Intelligence' suite, which incorporates ChatGPT features, while competitors have already launched advanced AI tools on Android devices.

Apple has been particularly affected by the escalating trade tensions, despite CEO Tim Cook's efforts to maintain a good relationship with the White House.

These delays in releasing Apple Intelligence could adversely affect upcoming announcements related to iOS 26, scheduled for next week, and further impact iPhone sales in China.

The absence of advanced AI features in Apple's offerings has been identified as a significant disadvantage in the competitive Chinese smartphone market.

Services revenue reached an all-time high of $26.6 billion, reflecting a 12% growth compared to the prior year, showcasing the strength of Apple's services segment.

As of June 4, 2025, ongoing trade disputes and regulatory scrutiny are contributing to a decline in projected growth for sectors reliant on international trade, including technology.

The CAC has approved over 300 domestic AI models, indicating a shift towards local AI development and adding pressure on Apple's partnership with Alibaba.