Salesforce Stock Plunges 4.38% on Trump Tariff Announcement

On April 4, 2025, Salesforce's stock price dropped by 4.38% in pre-market trading, reflecting the market's response to the recent announcement by U.S. President Donald Trump regarding tariffs on trading partners. This move has significant implications for companies like Salesforce, which rely heavily on international trade and supply chains.

Analysts from Bank of America have highlighted that the new tariffs, which include a 10% base tariff and additional retaliatory tariffs on certain countries, pose a substantial risk to e-commerce software providers. The termination of the low-value exemption for small packages from China and Hong Kong, effective May 2, 2025, is particularly concerning. This exemption previously allowed packages valued under $800 to enter the U.S. without tariffs, facilitating direct shipping from international manufacturers to American consumers. With the exemption now revoked, packages from these regions will be subject to varying tariff rates, increasing the cost and complexity of international trade.

Salesforce, with its significant international operations, is particularly vulnerable to these changes. The company's commercial cloud services, which account for 7.5% of its total subscription revenue in the 2025 fiscal year, are heavily reliant on global trade. The potential increase in tariffs could disrupt Salesforce's supply chain and impact its revenue streams, particularly in regions like China, which accounts for a significant portion of its international business. Additionally, the company's competitors, such as Shopify and Adobe, are also expected to face similar challenges, although the extent of their exposure varies.