Big Tech’s Silent Win: How Trump’s Trade War Fizzled – A Deep Dive
The first year of Donald Trump’s trade war presented a chaotic landscape for the tech industry, leaving companies scrambling to anticipate unpredictable twists and turns. While initial alarms sounded regarding potential cost increases for consumer technology, a surprising narrative unfolded. Instead of a full-blown economic crisis, Big Tech largely navigated the turmoil through a combination of appeasement, strategic deals, and, in some cases, outright silence. This article delves into the intricacies of this “silent win,” examining how major tech players responded to Trump’s policies, the unexpected outcomes, and the lingering uncertainties as we move into 2026 and beyond. We’ll explore the latest data, trends, and expert analysis to provide a comprehensive understanding of this complex situation.
Initial Fears and the Tariff Onslaught
In February, President Trump warned of “a little pain” as he initiated executive orders imposing tariffs of 10-25% on imports from key trading partners like Canada, China, and Mexico. Industry associations, including the Consumer Technology Association (CTA), immediately raised concerns about significant price hikes for consumer tech. By April, the scope expanded to include tariffs on virtually all US trade partners, justified by questionable trade deficit calculations. The absurdity of the situation was highlighted by tariffs targeting uninhabited islands populated solely by penguins – a move widely criticized as illogical and politically motivated.
The costs associated with these tariffs steadily increased throughout the year. However, the tech industry’s public pushback remained surprisingly muted. Instead, several of the largest companies adopted a more subtle approach, seeking to navigate the situation through direct engagement and strategic concessions.
Apple’s Appeasement Strategy: A Golden Gesture
Apple found itself in a precarious position early on, facing a potential 60% tariff on all Chinese imports – a move that could have severely impacted its business. In an attempt to appease the administration, Apple pledged a $500 billion investment in the US. However, this didn’t provide lasting relief. Trump subsequently demanded “Made in the USA” iPhones, a goal widely deemed “impossible at worst and highly expensive at best” by industry analysts.
Apple’s silence on the matter didn’t shield it from further scrutiny. In May, Trump threatened a 25% tariff on iPhones not manufactured in America – a unprecedented move targeting a specific company with tariffs. This raised legal questions about the president’s authority, but Trump never pursued the issue. Instead, he seemingly relented after receiving a gold statue from Apple in August. The engraved glass disc featured the Apple logo, Tim Cook’s signature, and a “Made in USA” stamp celebrating Trump’s “Apple American Manufacturing Program.” This incident underscored the unusual dynamic at play, where symbolic gestures appeared to outweigh substantive policy concerns.
Trump’s Deals with Chipmakers: A Mixed Bag
As pressure on Apple eased, Trump turned his attention to the semiconductor industry. In August, he publicly demanded Intel CEO Lip-Bu Tan’s resignation, alleging a “highly conflicted” situation. Tan responded by meeting with Trump and agreeing to a deal granting the US government a 10% stake in Intel. Trump touted the deal as a victory, framing it as allowing Tan to “keep his job.” However, The New York Times described it as one of the “largest government interventions in a US company since the rescue of the auto industry after the 2008 financial crisis.”
Intel’s Concerns and Potential Risks
Unlike the auto industry bailout, Intel didn’t require financial assistance. The deal risked disrupting Intel’s finances and spooked shareholders. In an SEC filing, Intel detailed potential downsides, including stock dilution and potential legal challenges from third parties, the US government, or foreign governments. Most concerningly, Intel admitted the inability to predict all potential risks, both short-term and long-term.
Trump also attempted to strong-arm the Taiwan Semiconductor Manufacturing Company (TSMC) into relocating half its chip manufacturing to the US, but TSMC firmly rejected the demand. Negotiations with other quantum computing firms yielded no immediate results, leaving their outcomes uncertain.
Nvidia and AMD: Revenue Sharing for AI Access
In October, Trump brokered a deal with Nvidia and AMD, requiring them to remit 15% of revenue from sales of advanced computer chips to China – chips potentially used for AI development. This agreement drew criticism, as it appeared to prioritize revenue over national security concerns. In December, Nvidia further agreed to give the US 25% of sales of its H200 AI chips, a less powerful alternative to the H20. Experts questioned the logic, suggesting the administration was accepting payments to overlook risks and potentially aiding China’s AI ambitions. The legality of such revenue-sharing arrangements remains questionable, with government lawyers reportedly exploring new policies to facilitate these payments.
The TikTok Saga: A Deal Finally Reached
ByteDance, TikTok’s parent company, faced mounting pressure throughout the year. Trump consistently sought a deal allowing the US to take majority ownership of TikTok and license its algorithm for a US-based version. While ByteDance initially resisted a sale, China’s approval was ultimately required. In December, ByteDance finally agreed to the deal, paving the way for Trump’s chosen investors to take control in 2026.
The future of TikTok under US control remains uncertain. Concerns exist about potential user attrition if US owners cater to Trump’s preferences, and the possibility of technical glitches in the new version. Legal challenges are expected in 2026, as the deal’s compliance with US law requiring ByteDance to divest control is debated.
The Looming Threat of Tariff Refunds and IEEPA
As 2025 drew to a close, the potential for massive tariff refunds emerged as a significant issue. The Supreme Court is currently reviewing whether the International Emergency Economic Powers Act (IEEPA) grants the president unilateral authority to impose tariffs. The CTA and the Chamber of Commerce filed a brief urging the Court to limit this authority, arguing it creates a “perfect storm of uncertainty.”
Under IEEPA, Trump imposed tariffs at rates as high as 125%, changing them over 100 times since the trade war began, affecting $223 billion of US exports. If the Supreme Court rules against Trump, the US could owe up to $1 trillion in refunds. Companies like Costco, Revlon, and Kawasaki have already filed lawsuits seeking refunds, with small businesses driving much of the opposition.
Economists argue that Trump’s trade deficit obsession is misguided, pointing out the US consistently runs a surplus in trade in services due to its dominant technology sector. Justices appear skeptical of Trump’s IEEPA authority, but expressed concerns about the “messy” implications of reversing the tariffs.
Reshoring Failures and the Labor Market
Despite Trump’s stated goal of bringing manufacturing back to the US, reshoring efforts have largely failed. Fortune reported in November that “reshoring progress is nowhere to be seen.” A Bureau of Labor Statistics report revealed the US lost blue-collar jobs for the first time since the pandemic. The Center for American Progress found that US employers cut 12,000 manufacturing jobs in August, with a total decrease of 42,000 since April.
Looking Ahead to 2026: New Threats and Uncertainties
Even a favorable Supreme Court ruling won’t guarantee relief for the tech industry. Trump has threatened tariffs on semiconductors and products containing them, potentially costing the industry $1 billion. The CTA warns of “tariff stacking,” where products could be taxed multiple times on individual components, leading to price increases and reduced US competitiveness.
The industry’s muted response to the trade war, driven by fears of jeopardizing lucrative government contracts, has been criticized. While some companies have sued to recover tariff payments, Big Tech has largely refrained from actively opposing Trump’s policies, opting instead for financial contributions to his campaigns and organizations.
The midterm elections could potentially pressure Trump to ease off aggressive tariff regimes, but his history suggests he may double down in response to opposition. Elon Musk, despite being an on-again-off-again ally, warned Trump that tariffs would drive manufacturing out of the US – a warning that was reportedly ignored.
As we enter 2026, the tech industry faces a complex and uncertain future. Navigating the evolving trade landscape will require vigilance, strategic planning, and a willingness to adapt to unpredictable policy shifts. The “silent win” of the past year may prove to be a temporary reprieve, as new threats and challenges loom on the horizon. GearTech will continue to monitor these developments and provide insightful analysis to help businesses navigate this evolving landscape.