Analysis. The latest round of tariff confusion – including a last-minute US Customs exemption for computers, smartphones, and related components, followed by a social media post from President Trump declaring the move temporary – is likely to trigger a slowdown in customer purchases.
The wild movements in tariffs on computer goods, including storage, make it impossible for businesses that rely on them to calculate stable costs. This means they won’t be able to assess how their market will react to the changed prices for the products and services they offer or, indeed, whether particular products and services are worth supplying at all.
The timeline of the recent tariff changes looks like this:
- April 2 – President Trump announced tariffs on all imported goods, but Executive Order 14257 said that semiconductors were exempt from tariffs, with a link to a 37-page Annex [PDF] listing non-tariffed items.
- April 7 – A 54 percent tariff on goods from China.
- April 9 – A 145 percent tariff on goods from China.
- April 11 – US Customs and Border Protection published “further guidance on the additional duties,” listing 20 Harmonized Tariff Schedule of the United States (HTSUS) codes exempt from tariffs, identifying 8471 and 8471.30.01, which describe computers and laptops, plus 8517.13, which covers smartphones, and 8542, whose subheadings cover CPUs, GPUs, systems on chips, microcontrollers, and memory.
- April 13 – President Trump declared that the tariff exemptions mentioned on April 11 were temporary as “we are taking a look at Semiconductors and the WHOLE ELECTRONICS SUPPLY CHAIN in the upcoming National Security Tariff Investigations.”
Commerce Secretary Howard Lutnick said on ABC News on April 13 that computers and smartphones would be included in this National Security Tariff Investigation: “They’re going to have a special focused type of tariff to make sure that those products get reshored.”
US buyers of hard disk drives and SSDs, and products like arrays that contain them, are facing cost uncertainty. This makes pricing calculations for HDD and SSD-based storage products and services difficult, if not impossible. It will encourage them to pause sales of such products and services until they have tariff stability and can calculate how to price them and even whether to offer them at all. A net effect could then be a slowdown in orders for HDDs and SSDs, which would depress the revenues of suppliers, such as Kingston, Kioxia, Micron, Phison, Samsung, Seagate, SK hynix, Toshiba and Western Digital, in the current quarter.
Daniel Ives, Managing Director at Wedbush Securities, commented on X (formerly Twitter) about “the mass confusion created by the constant news flow out from the White House” and asked: “How can companies give guidance in this environment?”
A Trump slump in storage supplier revenues is looking to be a potential outcome of all this tariff turbulence.
