Tariffs

Toyota has revised its full-year operating profit forecast upward to 3.4 trillion yen, despite a 1.45 trillion yen hit from U.S. tariffs. The September quarter’s operating profit, however, fell short of analyst estimates due to these tariffs, with a nearly 28% year-over-year decline in quarterly profit despite increased revenue. Toyota is exploring exporting U.S.-made vehicles to Japan in response to trade agreements. Analysts expect continued pressure on profitability, with potential recovery contingent on trade stability and currency fluctuations amidst growing EV competition.

Flexsteel Industries (FLXS) reported strong first quarter fiscal 2026 results, with net sales up 6.2% to $110.4 million and GAAP net income per diluted share increasing to $1.31. The company attributed the growth to effective product offerings and strategic investments. CEO Derek Schmidt acknowledged ongoing challenges, including tariffs on imported timber which are projected to impact sales and profitability short-term. The company ended the quarter with a strong liquidity position, including $38.6 million in cash. A conference call to discuss the results will be held on October 21, 2025.

Key market takeaways include renewed U.S.-China trade war tensions impacting market volatility, evidenced by intraday swings in the Dow. Despite these concerns, Treasury Secretary Bessent signaled the U.S. will maintain pressure on China. A federal judge blocked planned workforce reductions during the government shutdown. Apple unveiled new MacBook Pro, iPad Pro, and Vision Pro models, while Anthropic launched Claude Haiku 4.5. Finally, established automakers express EV concerns related to demand and profitability, as Tesla prepares to release its quarterly earnings report.

President Trump declared an end to the Middle East conflict, boosting market optimism despite earlier trade tariff concerns. A potential de-escalation with China and JPMorgan’s $10B investment in strategic sectors, including AI, further fueled market gains. Broadcom’s partnership with OpenAI on custom chip development challenges Nvidia’s dominance in the AI chip market. Additionally, the U.S. offered Argentina a $20 billion currency swap to address liquidity concerns before elections.

Apple CEO Tim Cook addressed concerns about iPhone 17 price increases, stating they aren’t due to tariffs. This comes after a $100 price hike for the Pro model, despite unchanged entry-level prices. While analysts anticipated tariff-related increases, Cook highlighted Apple’s efforts to mitigate impact, including supply chain diversification by shifting production to India and Vietnam. Apple absorbs significant tariff costs and balances global operations with U.S. investments. The company also faces challenges from competitors and navigating the AI landscape, focusing on practical AI applications rather than overt marketing.

Amid trade tensions, Apple CEO Tim Cook has strategically managed relations with the White House, seemingly safeguarding Apple’s interests. While Cook’s efforts, including U.S. investment pledges, have been perceived as successful in mitigating tariffs, analysts predict potential price increases for the upcoming iPhone 17 lineup. This is driven by factors like rising component costs and shifts towards higher-end models, despite Cook’s focus on supply chain optimization. Price adjustments may be subtle, such as discontinuing entry-level storage options.

Sony has completed shifting its PlayStation 5 (PS5) console production for the U.S. market out of China in response to U.S. tariffs. According to CFO Hiroki Totoki, this supply chain realignment aims to mitigate the impact of trade tensions. The production shift for PS5 peripherals is expected to be finalized by the end of September 2025. While current PS5 prices in the U.S. remain stable, Sony will dynamically adjust future pricing based on various factors including profitability and market competitiveness.

President Trump announced a potential 100% tariff on imported chips, sparking concerns about price increases. He clarified that the tariff exemption would apply to companies manufacturing in the USA. Apple CEO Tim Cook met with Trump, showcasing Apple’s increased US investment pledge to $600 billion, including a smart glass factory in Kentucky. The investment also supports Apple’s US supply chain. Trump reiterated his “Made in the USA” focus, preferring domestic production over Apple’s investments in India.

Apple’s fiscal Q3 2025 saw a revenue boost due to accelerated device purchases driven by consumer anxiety over potential tariffs, contributing one percentage point to the company’s 10% year-over-year revenue growth. Initial tariff announcements led to speculation about significant iPhone price increases, prompting consumers to buy early. Apple absorbed $800 million in tariff expenses in the June quarter and anticipates $1.1 billion in the September quarter, potentially leading to a $50 price increase for the iPhone 17 series models.

Nintendo’s stock hit a two-month high, fueled by the successful launch of the Switch 2 and its safe-haven status amid market volatility. The new console sold over 3.5 million units in its first four days, surpassing the original Switch’s launch performance and setting a new company record. Analysts attribute this to strong hardware sales and the gaming sector’s resilience against trade tensions, impacting other Japanese gaming companies positively.