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Vested Shorts: China’s 90% U.S. chip exemption, Apple’s $900M tariff hit, Airbnb’s 5% stock slide, Robinhood’s 100% crypto surge

by Parth Parikh
May 3, 2025
4 min read
Vested Shorts: China’s 90% U.S. chip exemption, Apple’s $900M tariff hit, Airbnb’s 5% stock slide, Robinhood’s 100% crypto surge

In today’s edition,

  • China’s chip catch-up
  • Apple’s tariff-driven shift
  • Airbnb and travel demand shift
  • Crypto holds ground for Robinhood

Market Snapshot

Stocks rallied last week as easing trade tensions and strong tech earnings lifted sentiment. 

The S&P 500 rose 2.85% to 5,686.67, the Nasdaq jumped 3.37% to 17,977.73, and the Dow added 2.85% to 41,317.43, marking the S&P’s second straight weekly gain and a nine-session winning streak for the Nasdaq.

Early optimism came from President Trump rolling back auto tariffs and signs of progress on a trade deal. Nearly 40% of the S&P’s market cap reported earnings, and despite limited guidance due to policy uncertainty, results held up well.

Labor data was mixed but encouraging: job openings fell and private payrolls slowed, yet April’s official report showed 177,000 new jobs, well ahead of expectations with wage growth at a mild 0.2%.

Even with a surprise 0.3% GDP contraction in Q1, flat inflation and strong consumer spending suggest the economy remains stable. Markets took it all in stride, betting that earnings and demand can withstand policy noise for now.

Stock market closing data for the week of Apr 28th to May 2nd, 2025

News Summaries

Despite the push for domestic chips, China imported $412 billion worth of semiconductors in 2024, up 10% from the previous year. The dependency showed when Beijing exempted over 90% of U.S. chip imports, including critical automotive components, from its 125% retaliatory tariff after lobbying from Chinese automakers. While China aims for 25% local chip use in cars, the figure remains closer to 15%. Global players like Texas Instruments still dominate due to their comprehensive portfolios and years of safety validation—something local firms like Geehy cannot yet match. The pandemic-driven chip shortage gave domestic players a foothold, but geopolitical pressure is now accelerating the shift. Localisation is no longer a choice; it’s a necessity. And while the transition will be slow, it’s already underway.

Apple’s June-quarter playbook is clear: shift device assembly to India and Vietnam to avoid U.S. tariffs, which could otherwise add $900 million in extra costs. While iPhone sales rose 2% and overall revenue reached $95 billion (up 5% year-over-year), investor focus remained on Apple’s ability to mitigate China risk. CEO Tim Cook confirmed that most iPhones for U.S. buyers would now be India-made, while Vietnam would handle nearly all iPads, Macs, Watches, and AirPods. Apple’s China sales dipped by over 2% amid local brand preference and legal pressures, including scrutiny of the App Store and the looming loss of Google’s $20 billion search default deal, which added to the uncertainty. A complete shift away from China is challenging, given the ecosystem Apple helped build there over the past few decades, but Cook knows that overreliance is costly. The bigger story isn’t just about earnings; it’s about resilience. Apple isn’t exiting China, but it’s building a Plan B. And this time, it’s not waiting for a crisis to act.

Airbnb is down about 5% year-to-date as signs of a travel slowdown, especially in the U.S., affect its outlook. The company saw an 8% rise in global bookings in Q1, reaching 143.1 million. Revenue increased by 6% to $2.27 billion, but future guidance disappointed. North American demand is softening, with fewer long-term bookings and weaker foreign travel. Analysts from firms like Wedbush and Truist noted that third-quarter travel demand is tracking below Q2 levels, leading to stock downgrades. Although high-end U.S. travelers continue to spend and Airbnb’s exposure to inbound tourism is low at 2–3% of the business, the company’s net income dropped by 41.7%. Its cautious Q2 revenue forecast of $2.99 to $3.05 billion shows growing pressure. Airbnb benefits from strong brand recognition and flexible inventory, but in a more uncertain economy, even a solid platform can’t escape cooling demand.

From the World of Crypto

Robinhood’s latest results offer a window into where retail crypto trading might be headed, especially with Coinbase set to report earnings next week. 

The trading platform generated $927 million in revenue in Q1 2025, a modest dip from the $1 billion recorded in the final quarter of 2024 as post-election market activity slowed. 

But the real surprise came from crypto: revenue from digital assets surged to $252 million, twice as much as last year’s period. It’s a sharp rebound that shows retail appetite for crypto is far from fading, even in a cooling market.

Much of Robinhood’s Q4 surge came from a spike in trading after Donald Trump’s election win. But the momentum didn’t quite hold into the new year, with transaction-based revenue dropping 13%. Still, the company is signaling confidence as it just expanded its share buyback plan by another $500 million, taking the total authorized to $1.5 billion.

The bigger takeaway here is what this means for Coinbase. Historically, Robinhood’s crypto activity has been closely tracked by Coinbase’s retail volumes. And while analysts expect a slight dip in Coinbase’s revenue and trading volume this quarter, the resilience in Robinhood’s crypto numbers hints that the pullback might be milder than feared.

In short, even in a cooling market, crypto remains sticky. Retail traders may be quieter, but they’re not leaving and that’s a positive signal for Coinbase heading into May 8.

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