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The sweeping tariffs imposed by the Trump administration — including a 104% duty on Chinese imports — have one analyst calling the move an “Armageddon scenario” for the U.S. technology sector.
That’s according to Wedbush Securities analyst Dan Ives, who warned Wednesday that President Donald Trump’s tariffs “will go down as the worst U.S. policy mistake” since the Smoot-Hawley Tariff Act of 1930, which deepened the Great Depression. Ives said the tariffs will significantly affect the U.S. tech sector because the “hearts and lungs of the supply chain are cemented in Asia.”
He wrote, “A U.S. tech company CEO cannot decide last night... ‘Lets call Smith Semi Fab Operations in the Midwest to get those semi chips’... as there is one slight problem... IT DOES NOT EXIST... and would take 4-5 years to build a manufacturing plant... and the labor force does not support this in the U.S.... the IP of the supply chain is cemented in Asia after 30 years of making U.S. tech products... and the products will go up 3x-4x once implemented after years... being paid by the U.S. consumers/companies.”
Ives added, “‘Debacle’ is an understatement for this tariff policy.”
The “self-inflicted uncertainty” of the tariffs has “turned the global supply chain upside-down, and U.S. consumers are the ones paying,” according to Ives. He doesn’t expect any tech companies to give guidance on first-quarter conference calls, given all the uncertainty. Still, he recommends owning stocks in Apple (AAPL+4.00%) and Nvidia (NVDA+2.52%) because “despite this massive, near-term uncertainty, it does not change their installed base, technology leadership, and long-term growth opportunities, especially with Nvidia leading the AI industry.”
Apple is down 20% since Trump announced the sweeping tariffs on the so-called “Liberation Day” on April 2 and 28% year-to-date. Nvidia is down 10% since the recent tariff announcement and 26% year-to-date.
Ives said Wedbush will stay fluid. The firm work under the assumption that the tariffs in their current form will stick around for a few months and will adjust its numbers as the tariffs change or remain.
The Wedbush analyst recommends tossing out the next few quarters (June and September) and working with new financial models for 2026 for valuations as the tariff situation gets negotiated. Ives said his firm has a worst-, base-, and bull-case framework that it’s using to screen tech stocks; that’s how Wedbush will “navigate this unprecedented situation” and hold investors’ hands over the coming days and weeks.
“Market volatility and nervousness has been one of the highest I have seen in 25 years on this job covering tech stocks on the Street,” Ives said. “Now, the question is what is next and how to navigate this Category 5 storm tariff coming to the U.S economy.”