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Business Insider
6 minutes ago
- Business Insider
What Apple's $100 billion US pledge really means — and what it doesn't mean
At a White House event scheduled for Wednesday afternoon, Apple is going to announce plans to invest $100 billion in US manufacturing. Is this a real plan, with real money? A bit of stagecraft designed to give Donald Trump a public win for his reshoring push? Or a way for Apple to keep on the right side of Trump tariffs that could cause great harm to the company? Yes. And yes. And yes. Here's what we know about Apple's plans, via news reports and the White House press office. (Apple hasn't responded to a request for comment, but the White House was happy to confirm the reports in advance of the event, which is supposed to feature both Trump and Apple CEO Tim Cook.) In February, Apple said it would invest $500 billion and hire 20,000 US employees over the next four years. Now Apple is going to add another $100 billion to that commitment, though there's no word about any potential hiring increase. But this isn't the first time Apple has announced a pledge like this. In 2021 — when Joe Biden was president — it announced a plan to invest $430 billion in the US over five years and hire 20,000 employees. Some of those plans involved new construction, like a new "engineering hub" in North Carolina. Others involved expansions of existing facilities, or construction that was already underway, like a $1 billion campus in Austin. As Bloomberg notes, Apple's announcement from February was really an acceleration of its earlier plans — it meant Apple was planning to spend an extra $39 billion a year, and to increase its hiring plans by 1,000 people a year. Using that same logic, Apple's Wednesday announcement means it is planning on spending another $25 billion a year above its earlier plans. (Again: No word, yet, about any additional hiring.) So that's definitely some additional spending. Will Apple make iPhones in the US? Does that mean Apple is going to start making iPhones in the US, as Trump has demanded? No. As we've discussed before, recreating the supply chain Apple would need to make iPhones in the US seems close to impossible. And certainly not something that Apple could pull off in a few years — if it even wanted to. But getting to stand next to the CEO of one of the world's most valuable companies, while that CEO says he's going to invest in America, is most definitely valuable to Trump. And it's not as if any particular number means much to Trump, who recently announced he was going to reduce drug prices by "1,500 percent," which is definitely not possible. Trump is also flexible when it comes to announcements about Trump-directed spending in America. Like when he stood next to Cook during his first term and announced that Apple had opened a new plant in Texas at his behest. Also not true. What does Apple get in return? It would most obviously like permanent relief from Trump's tariffs. So far, Trump has granted Apple some immunity from some of his tariffs on foreign manufacturing — but not all of them, which is why Apple has said it will have paid some $2 billion in tariffs over its last two quarters. Apple and other tech companies are also hoping Trump will keep pushing on their behalf to beat down other countries' tech regulations. Apple is particularly vexed by the European Union, which has forced the company to do things like change its iPhone chargers and open up its App Store. So yes: Apple is spending money in the US. And no: It's not exactly the story Donald Trump would like to tell.
Bloomberg
6 minutes ago
- Bloomberg
OpenAI in Talks for Share Sale at $500 Billion Valuation
OpenAI is in early talks about a potential sale of stock for current and former employees at a valuation of about $500 billion, people briefed on the investment discussions said. The company is targeting a secondary stock sale in the billions of dollars, the people said, asking to remain anonymous because they weren't authorized to discuss the matter publicly. If the deal goes ahead, it would elevate OpenAI's on-paper price tag by roughly two-thirds. Its previous valuation stood at $300 billion in a $40 billion financing round led by SoftBank Group Corp. — making it one of the largest privately held companies in the world. Representatives for OpenAI and Thrive declined to comment. The company is also is providing access to its ChatGPT product to US federal agencies at a nominal cost of $1 a year as part of a push to get its AI chatbot more widely adopted. Shirin Ghaffary reports. (Source: Bloomberg)
Bloomberg
6 minutes ago
- Bloomberg
Trump, Apple to Announce Fresh $100 Billion US Investment
President Donald Trump plans to announce that Apple Inc. will commit to spending another $100 billion on domestic manufacturing, the latest pledge by the tech giant to increase US production of its products as it seeks to avoid punishing tariffs on its flagship iPhones. The announcement at the White House on Wednesday includes a new manufacturing program designed to bring more of Apple's supply chain to the US, with an eye toward assembling additional critical components domestically, according to a White House official who detailed the announcement on the condition of anonymity. Apple Chief Executive Officer Tim Cook is expected to attend the event. Bloomberg's Managing Editor for Global Consumer Tech Mark Gurman reports. (Source: Bloomberg)
