ERIC KIM ₿

Why is Google stock down with tariff? Also also Facebook meta?

Thinking at the speed of AI?

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“Bitcoin was the solution to being profitable on the Internet without advertising after all”— essay in eric kim voice

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Curiosity —> these tech stocks,,,, are based on digital information ,, not physical products,, so why they dropping?

Reduced consumer spending ,,, less advertising revenue

Meta and Facebook too,,, less international product spending, less advertising profits.

Key Points

  • Research suggests Google’s stock decline is linked to recent tariff announcements, increasing costs for imported components and reducing consumer spending, affecting advertising revenue.
  • It seems likely that Meta’s stock drop is also due to tariff-related market uncertainty, impacting its advertising business and hardware costs.
  • The evidence leans toward broader economic effects from tariffs, with both companies facing indirect impacts on global operations.

Why Google’s and Meta’s Stocks Are Down

Market Reaction to Tariffs
Recent tariff announcements by President Donald Trump, effective as of early April 2025, have led to significant market volatility. These tariffs, including a 10% blanket tariff on all imports and higher rates for specific countries like China (34%), have raised concerns about increased costs for companies with global supply chains. For Google, this means higher expenses for imported components used in hardware like Pixel phones and Chromebooks, potentially squeezing profit margins. For Meta, similar cost increases affect its hardware division, such as Oculus VR headsets.

Impact on Advertising Revenue
Both Google and Meta rely heavily on advertising revenue, which could be indirectly hit by tariffs. Higher prices for imported goods may reduce consumer spending, leading to lower ad budgets from businesses, especially international advertisers. For Meta, it’s noted that 10% of its 2023 revenue came from Chinese companies advertising on platforms like Facebook and Instagram, which could be at risk if tariffs raise costs for these advertisers Why Trump’s Tariffs Are Rattling Even Meta.

Global Operations and Economic Uncertainty
Both companies have significant international operations, and the tariff-induced economic uncertainty could disrupt global trade, affecting their revenue streams. This broader market unease, as seen in the sharp declines in major indexes like the Nasdaq (down 5.97% on April 3, 2025), has contributed to the stock drops Stocks ravaged by tariff fallout as global supply chains brace for impact.

Survey Note: Detailed Analysis of Google and Meta Stock Declines Amid Tariff Announcements

This section provides a comprehensive examination of the recent declines in Google (Alphabet Inc.) and Meta Platforms’ stock prices, focusing on the impact of President Donald Trump’s tariff announcements as of April 6, 2025. The analysis considers market reactions, company-specific exposures, and broader economic implications, drawing on recent news and analyst insights.

Background on Tariff Announcements

On April 2, 2025, President Trump announced a sweeping tariff policy, imposing a minimum 10% tariff on all imports, with higher rates for specific countries, such as 34% for China, 20% for European nations, and 24% for Japan Apple leads a drop in tech stocks after Trump tariff announcement. This followed earlier tariff threats, including 25% on Mexican and Canadian imports and 10% on Chinese goods, announced in February and March 2025 Tariffs war: Meta and Google ‘most unfavorably positioned’ internet stocks By Investing.com. These measures have sparked significant market turmoil, with the Dow Jones Industrial Average falling 3.98%, the S&P 500 losing 4.84%, and the Nasdaq plummeting 5.97% by April 3, 2025 Stocks ravaged by tariff fallout as global supply chains brace for impact.

Google (Alphabet Inc.) Stock Decline

Google’s stock, under the ticker GOOGL, experienced a notable decline, closing at $145.60 on April 4, 2025, down 3.40% from the previous day, following a broader market sell-off Alphabet Inc. (GOOG) Stock Historical Prices & Data – Yahoo Finance. Several factors contribute to this decline:

Meta Platforms Stock Decline

Meta’s stock, under the ticker META, also saw a significant drop, falling 9% on April 3, 2025, to $531.62, amid the tariff-induced market sell-off Why Trump’s Tariffs Are Rattling Even Meta. The reasons include:

Comparative Analysis

Both companies face direct impacts from tariffs on their hardware divisions and indirect impacts through their advertising businesses. Google’s exposure is heightened by its leadership in the tech stock slump, possibly due to its significant hardware costs and international revenue streams Google Leads Tech Stock Slump As Earnings, Trump Tariffs Fallout Weighs On Market. Meta’s vulnerability is noted in its reliance on Chinese advertisers, with specific figures highlighting the potential revenue hit Why Trump’s Tariffs Are Rattling Even Meta. The market’s reaction, as seen in the table below, underscores the severity of the tariff fallout:

DateIndex/EventChange (%)Notes
April 2, 2025Trump announces tariffs–Announcement after market close, setting stage for sell-off
April 3, 2025Dow Jones Industrial Average-3.98%Worst day since pandemic, tariff fallout cited Stocks ravaged by tariff fallout
April 3, 2025S&P 500-4.84%Broad market impact, tariff uncertainty noted Wall Street ends down sharply on tariff worries
April 3, 2025Nasdaq-5.97%Tech-heavy index hit hardest, affecting Google and Meta Stocks plunge in another brutal day over Trump tariffs shock : NPR
April 4, 2025GOOGL Close Price-3.40%From $150.72 to $145.60, post-tariff market reaction Alphabet Inc. (GOOG) Stock Historical Prices & Data – Yahoo Finance
April 3, 2025META Close Price-9%Fell to $531.62, significant drop amid tariff news Why Trump’s Tariffs Are Rattling Even Meta

Conclusion

The declines in Google and Meta’s stocks are multifaceted, driven by direct cost increases for hardware due to tariffs and indirect effects on advertising revenue from potential economic slowdowns. The market’s reaction to Trump’s tariff announcements has amplified these impacts, with both companies facing heightened uncertainty as of April 6, 2025. Further developments, such as retaliatory tariffs from affected countries and company-specific earnings reports, will likely influence future stock movements.

Key Citations

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