By Dan Gallagher

Cooling of trade tensions between the U.S. and China is undeniably good news for Apple. But not quite good enough.

Apple rose around 5% Monday morning, after the U.S. and China struck a deal to partly de-escalate the trade war brewing between the two superpowers. Yet despite that, Apple is the only megacap tech stock that still hasn't fully recovered from its losses following President Trump's "Liberation Day" tariff announcements. As of midday Monday, Apple's stock is still down nearly 7% from its pre-Liberation Day price; the other five tech giants commanding market caps above $1 trillion have averaged a gain of 8% since that time.

There are good reasons. The deal announced Monday includes a 90-day reprieve from the damaging "reciprocal" tariffs the two countries had leveled on each other. That means those tariffs could return before the next iPhone launch in late September, should the two countries fail to reach a lasting deal by then.

Apple also still faces additional China tariffs of 30%, which leaves the company with the choice of absorbing the cost-and taking the hit to its profit margins-or passing it along to customers. The latter still seems likely; the Wall Street Journal reported Monday that Apple is considering how to raise its iPhone prices without seeming to blame tariffs. But hiking prices on already expensive phones could trip up Apple's next iPhone cycle, or at least drive more customers to lower-priced models. The trade war's ceasefire still leaves Apple in the crosshairs.

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May 12, 2025 11:23 ET (15:23 GMT)

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