Good morning, Quartz readers!
Here’s what you need to know
The art of the yield. President Donald Trump said he’d be in favor of a millionaire tax hike — but doesn’t want to be in a position “where we lose an election because I was generous.”
Modi operandi. Amid a swirling trade war and 145% tariffs on China, Apple is looking to move all production of its U.S.-sold iPhones to India by 2026.
Cabin pressure. Southwest’s CEO said the recession is already here for airlines, adding that travel is falling in ways not seen since the pandemic.
Courtroom gains. Novo Nordisk just got a big win: A judge ruled that compounding pharmacies have to stop making cheaper versions of its weight-loss and diabetes drugs.
The electric slide. While Tesla falters, its Chinese competitor, BYD, continues to soar. The automaker posted earnings that blew Elon Musk’s company away — despite BYD vehicles not being available in the U.S.
Duty calls. The Trump administration is closing a loophole that lets online shoppers dodge tariffs on low-cost goods, and Temu and Shein are raising their prices.
Call Xi, Maybe
In a classic game of diplomatic telephone, President Trump said Chinese President Xi Jinping called him to talk about trade. But Chinese officials have indicated the phone line is dead.
In an interview with Time, Trump said, “He’s called. And I don’t think that’s a sign of weakness on his behalf.” But Chinese Ministry of Commerce spokesperson He Yadong told reporters that there are currently “absolutely no negotiations on the economy and trade between China and the U.S.” A different Chinese government spokesperson called reports of such talks “fake news.”
As Trump left the White House on Friday for an overseas trip, he was pressed for details of his call with Xi. “I don’t want to comment on that, but I’ve spoken to him many times,” Trump said. Quartz’s Catherine Arnst has more on the great wall of silence.
Alphabet Soup-ercharged
No search errors here: Google’s first-quarter earnings report came in strong, solidly beating Wall Street’s expectations: $90.2 billion in revenue and earnings per share of $2.81. Investors liked what they saw: growth in ad revenue, cloud computing, and AI.
“We are so back,” Wedbush analysts wrote.
Google Search continues to be the company’s revenue anchor — it’s the company’s largest ad segment, and its revenue grew almost 10% year over year. But a surprising chunk of that revenue came from Google’s generative AI Overviews, which the company’s chief business officer said is monetized “at approximately the same rate” as traditional search results. Google Cloud was an earnings bright spot, too; its growth seems to be outpacing the rest of the cloud computing sector. And even Waymo got a little love on the earnings call with CEO Sundar Pichai.
There are some hurdles ahead — see: trade-war concerns, antitrust cases that could see the company broken up, general macroeconomic instability — but analysts still upped their 2025 estimates for the company. Quartz’s Shannon Carroll has more on earnings that were Waymo than expected.
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