The tough year of 2025 for Apple is so far the biggest test for Tim Cook

The year 2025 Apple ( AAPL ) could not be worse. The stock price dropped by 19% over the year, the company faces an anti-trust investigation of the Justice Department (DOJ) and is inactive measured with Epic Games on purchases at the App Store. The company has delayed the improved Siri by the end of this year and is inactive trying to catch up with competitors specified as Google (GOOG, GOOGL) and Samsung, on the AI front. And last week, Apple's erstwhile plan chief, Jony Ive, announced that he was working on a fresh consumer product with Sam Altman and OpenAI ( OPAI.PVT). president Trump will now come for the company's most crucial product: iPhone.

Trump sent a message on Friday to his fact Social account, demanding that Apple produce its iPhones in the US or had to face a 25% duty. He later said that the same terms apply to Apple's rival, Samsung. "In my opinion, the combination of all these factors is undoubtedly the hardest effort Apple has faced in a very long time," said founder and chief analyst TECHnalysis investigation Bob O'Donnell in an interview with Yahoo Finance. "This creates a series of question marks around the company that ... has never encountered serious question marks for a long time".

The only individual who can answer these questions is CEO Tim Cook. Although he has dealt with crises in the past, including the COVID supply chain crises, a fewfold of the problems facing the iPhone maker will prove to be Cook's biggest challenge.

Trump's threats about iPhone

The most urgent threat to Apple is Trump's threat of imposing a 25% work on Apple's iPhone if Cook does not decision production to the US. "A long time ago I informed Tim Cook of Apple that I anticipate their iPhones [sic], which will be sold in the United States of America, will be produced and built in the United States, not in India or elsewhere," Trump wrote in a post Truth Social, May 23rd . ‘If this is not the case, Apple must pay a work of at least 25% to the United States’

Apple mostly avoided Trump's first work on the occasion of the “Day of Liberation” and subsequent increased charges on goods from China, moving iPhones and another equipment production to India, Vietnam and another regions.

During a telephone conversation about the company's financial results in the second 4th of Cook said that most of the iPhones destined for the US this 4th would come from India, and almost all iPads, Mac computers, Apple Watche and AirPods would come from Vietnam. However, he added that Apple would carry $900 million failure due to duties in this quarter.

The production of an iPhone in the United States would require not only a hercule effort that would not be possible during Trump's term, but would besides consequence in an increase in the iPhone's price of hundreds of dollars. "The fact that Apple will be able to produce iPhones in the US is highly unlikely. And even if they did their best... It is simply a substance of 5 to 10 years," O’Donnell said. "Until they want to decision this kind of production to the US, everything will end with robotics," he added. “So in the United States it will just be robots, not people. This is not going to make all this immense number of jobs."

According to Sharon Shih of Morgan Stanley Research, an iPhone produced in the U.S. would most likely cost 35% more than produced in China or India due to duties on iPhone components from China and higher labour costs in the USA. This would rise the price of iPhone 16 Pro from 999 to $1350.

However, if Apple decides to accept a 25% work in its present form, Erik Woodring of Morgan Stanley estimates that the company would only gotta rise iPhone prices by 4–6%.

AI and Jony Ive

But Trump's tariff threat is simply a transitional issue that can change at any time. Apple's bigger problem is simply a slow start in AI competition. The company introduced its Apple Intelligence platform in October 2024, long after Google and Microsoft ( MSFT ) made their debut with their own AI services, and delayed the release of an improved Siri version by the end of this year. In addition, Apple faces a fresh competitor in the consumer electronics marketplace in the form of Ive’s and Altman’s devices based on artificial intelligence.

"If I were Tim Cook, I wouldn't let myself sleep at night, it's a question of artificial intelligence," said Gene Munster, managing partner of Deepwater Asset Management, in an interview with Yahoo Finance. "And I think the Ive announcement underlines that there are deep portfolios that foresee a seismic change in the way companies and consumers usage technology. And the strength of this change, AI, is something Apple is struggling with.”

Apple has the chance to change the communicative around its artificial intelligence offer during an event for WWDC developers to be held on June 9. Apple is expected to present the latest versions of its operating systems, including iOS 19 and iPadOS 19, as well as another version of the macOS system. Apple will besides request to supply more information about erstwhile consumers can anticipate the latest version of Siri, and besides make certain that waiting for the software was worth the effort.

Department of Justice and Epic

In the background of all this, Apple's ongoing legal conflict with the Justice Department and the creator of the "Fortnite" Epic Games. The Justice Department filed an antitrust suit against Apple in March 2024, arguing that the company maintains illegal monopoly on the smartphone market. According to the antitrust lawsuit, Apple harms consumers by making it hard for iPhone users to control to competitive products and access to competitive services. The complaint besides concluded that Apple harms the developers of the application by imposing restrictions on the creation and distribution of the application. Losing in this case may force Apple to supply its closed applications and services, making it easier for users to access third-party equipment and services.

Apple is besides active in the Department of Justice's antitrust case against Google's dominance in search. This case Google lost revolves around different Google agreements to keep its search empire from competing, including contracts worth $20 billion a year with Apple, which makes Google a default search engine on iPhones, Mac computers and another devices. If Google is forced to retreat from this agreement, this will origin crucial harm to Apple's business revenues.

Apple is inactive struggling with the effects of the legal conflict with Epic Games, which has shown that although Apple does not violate antitrust law, it must supply the developers of the application with a way of directing customers to buy apps outside Apple's App Store, thus avoiding the fees charged by that company.

But according to U.S. territory justice Yvonne Gonzalez Rogers, Apple didn't do it. Instead, she started charging developers a fresh acquisition fee, which customers made in their apps outside the App Store. Gonzalez Rogers asks prosecutors to analyse Apple's activities to analyse the alleged ‘cover-up’. All of this consists of a frightening year of 2025 for Apple. And it's a long time to go.