Finance
Trump trade war spreads more gloom across businesses worldwide
Published by Global Banking & Finance Review®
Posted on April 24, 2025
5 min readLast updated: January 24, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on April 24, 2025
5 min readLast updated: January 24, 2026
Trump's trade war causes global business uncertainty, impacting costs and profit forecasts. Companies like P&G and PepsiCo face challenges amid shifting tariffs.
By Richa Naidu, Hyunjoo Jin, Jessica DiNapoli
LONDON/SEOUL/NEW YORK (Reuters) -Businesses across multiple industries are hiking prices, backing away from previous financial guidance and warning of growing uncertainty as U.S. President Donald Trump's trade war pushes up costs, upends supply chains and stirs concerns about the global economy.
Earnings releases on Thursday showed that corporations around the world ran into a wall of uncertainty in the first quarter, as executives found themselves navigating the Trump administration's constantly shifting stance on trade. With the earnings season entering its second busy week, companies were counting the costs of the chaos and setting out how they plan to stem the fallout.
"We will have to pull every lever we have in our arsenal to mitigate the impact of tariffs within our cost structure and P&L," Procter & Gamble Chief Financial Officer Andre Schulten said on a media call after the Pampers maker announced plans to hike prices to cover the impact of extra costs from the sweeping tariff war.
Comments from the biggest packaged food, drinks and consumer goods companies also underscored worries among businesses and investors that Trump's vacillating stance on tariffs and his attacks on Federal Reserve Chair Jerome Powell will hurt confidence on Main Street.
P&G, soda and snacks giant PepsiCo and medical equipment maker Thermo Fisher Scientific, became the latest companies to cut annual profit forecasts, citing trade turmoil. American Airlines withdrew its 2025 financial guidance, mirroring its peers in the airline industry.
"Relative to where we were three months ago, we probably are not feeling as good about the consumer," PepsiCo CFO Jamie Caulfield said on a post-earnings call.
Other companies voiced similar sentiments. Nestle CEO Laurent Freixe, Dove soap maker Unilever, and Chipotle Mexican Grill have all flagged weakening U.S. consumer confidence.
Almost 30 companies around the globe have either withdrawn or cut their forecasts in the past two weeks, a Reuters analysis shows, including building products company Masco and U.S. airlines Delta and Southwest.
Elon Musk's Tesla said it will reassess its growth forecast in three months due in part to trade policy as well as a backlash that has hurt sales of the EV maker.
Trump announced hefty tariffs on most other world nations in a pomp-filled event in early April that shook business and consumer confidence and led to a rapid selloff of U.S. assets.
Since then, Trump has alternated between retracting some of those levies while threatening additional industry-specific tariffs on trucking, pharmaceuticals and semiconductors, among other industries.
Administration officials have pointed to ongoing talks with numerous nations as a measure of success of Trump's rhetoric, but numerous companies said the ongoing back-and-forth has left them uncertain how to plan for coming quarters.
"We don't want... to make short term sourcing changes or short-term formulation changes unless we know what the environment is we're dealing with," said P&G's Schulten.
He said the company is waiting for certainty before making decisions, which "have a lead time of multiple months, sometimes years and reversing them has similar lead times. So any knee-jerk reaction doesn't make a whole lot of sense."
The market's harsh reaction caused Trump to pause most tariffs until July 8, but a 10% universal rate and duties on aluminium, steel and car imports remain in place, as does an eye-popping 145% levy on goods imported from China.
The White House said it will look at lowering tariffs on imported Chinese goods pending talks between the two countries, a source told Reuters on Wednesday, but Beijing has so far rebuffed that offer, saying Washington must cancel all tariffs before negotiations begin.
The U.S. equity market has stabilized in recent days as Trump has suggested he may back off certain tariffs; the administration has said it is moving forward with talks with Japan, South Korea and other countries. Stocks rose on Thursday, continuing the week's gains, though the broad-market S&P 500 is still down 7.5% on the year.
SHIFTING INVESTMENTS
Korea's Hyundai Motor said it had launched a task force to handle its response to the tariffs and moved production of some Tucson crossover vehicles from Mexico to the U.S.
"We expect a challenging business outlook to continue due to intensifying trade wars and other various unpredictable macroeconomic factors," the automaker said.
Hyundai is also considering whether to move production of some U.S.-bound cars from South Korea to other locations, it said as it reaffirmed its annual earnings targets.
Hyundai and affiliate Kia, which together are the world's third-biggest automaking group by sales, generate about a third of their global sales from the U.S. market and imports account for roughly two-thirds of their U.S. car sales.
Several major drugmakers have said they will invest additional dollars in the U.S., where many operate already, even as they have been concerned about healthcare funding cuts and mass layoffs at the U.S. Food and Drug Administration.
"The concern for us is anything that would impact innovation," said Bristol Myers CFO David Elkins, "or would restrict access to medicines for patients."
Chinese e-commerce giant JD.com said nearly 3,000 firms have already made enquiries about its 200 billion yuan ($27.35 billion) fund, announced on April 11, to help exporters sell their products domestically over the next year.
(Reporting by Richa Naidu in London, Chandini Monnappa in Bengaluru, Hyunjoo Jin in Seoul, Vera Dvorakova and Michal Aleksandrowicz in Gdansk; Writing by Josephine Mason; Editing by Catherine Evans and Marguerita Choy)
The article discusses the impact of Trump's trade war on global businesses, causing uncertainty and affecting profit forecasts.
Companies are revising profit forecasts and adjusting strategies to mitigate the impact of increased costs and supply chain disruptions.
Industries such as consumer goods, airlines, and automotive are notably impacted by the trade war and tariffs.
Explore more articles in the Finance category
