To The Moon

US’s GDP for Q1 2025 (Prelim).

In my Wed, 30 Apr 2025 post, I have shared Wall Street’s forecast on US’s Q1 2025 GDP (prelim). (click here ! for the estimates)

When actual report was released, reading was far weaker than the 0.8% shared. (see below)

US Q1 2025 - GDP prelim

According to the advance estimate released by US Bureau of Economic Analysis (BEA), real gross domestic product (GDP) for Q1 2025 (January, February, & March), came in at -0.3% annual rate.

Just for the record, real GDP was 2.4% in Q4 2024, that’s a -2.7% fall.

Factors dragged down GDP.

Just as I had shared in my Wednesday post, the decrease in real GDP was ‘caused’ by :

• A disproportionate increase in imports, that are a subtraction in the calculation of GDP.

• A decrease in government spending. (see above)

These movements were partly offset by increases in investment, consumer spending, and exports.

As if a negative growth is not bad enough, the incumbent President has this to say:

• This is Biden's Stock Market, not Trump's," claiming the downturn stemmed from an "Overhang" left by Biden's policies.

• The contraction had "nothing to do with tariffs" even though analysts linked the GDP drop to businesses rushing to import goods ahead of Trump’s tariff implementations.

How to react to such rude & callous comments ? Doesn’t citizens feel offended that the speaker again get away with saying things that are false ?

ADP Employment - April 2025.

US private sector payroll report - ADP Employment was the 2nd blow of the day. (see above)

ADP reported companies slowed hiring sharply as they braced against potential impacts from Trump’s tariffs.

ADP payrolls rose by just 62,000 for April 2025, the smallest gain since July 2024, down from March’s 147,000.

The total marked a deceleration from a downwardly revised gain of 147,000 in March and missed the Dow Jones consensus estimate for an increase of 120,000.

US Weekly Jobless Claims.

For week ending 26 Apr 2025, US weekly first-time filings for unemployment insurance totaled a seasonally adjusted 241,000. (see above)

This was up +18,000 from the week before and it’s higher than the Dow Jones estimate for 225,000.

Historically, this was the highest total since February 2022.

US Continuing Jobless claims.

A ‘more’ holistic overview of US labour market is actually the US Continuing Jobless claims report.

Continuing claims, which run a week behind, rose to 1.92 million, up +83,000 to the highest level since 13 Nov 2021.

These are American citizens who have been consistently unemployed (for all reasons) and are adding to US national debt/burden.

According to Pantheon Macroeconomics, Chief US economist, Sam Tombs - deterioration in the timeliest hiring and firing indicators over the last couple weeks suggests that jobless claims will trend up over coming weeks.

Summary.

Looking at above 3 jobs reports, coupled with a weak JOLTs (jobs opening & labour turnover surveys) for March 2025, its four strikes in a row, when it comes to US jobs and labour market.

What fresh perspective will US Non-farm payroll tells us when it is released on Fri, 02 May 2025 ? Not much I guessed.

S&P Global US Manufacturing PMI

Apart from worrying trends in US jobs / labour market, the S&P Manufacturing PMI report released yesterday is a concern too.

The Manufacturing Purchasing Managers' Index (PMI) measures the activity level of purchasing managers in the manufacturing sector.

For April 2025, S&P Global US Manufacturing PMI was revised down to 50.2, unchanged from March 2025 and below the preliminary estimate of 50.7. (see above)

The reading signaled a marginal expansion in the manufacturing sector, as output declined for a 2nd straight month, even as new orders rose for the 4th consecutive month—driven mainly by domestic demand.

In contrast, new export orders fell at the sharpest pace since November 2024, weighed down by tariff-related pressures.

As much as US Treasury Secretary Scott Bessent painted a one-sided story that the Chinese economy is at risk of losing 10 million jobs, the same could be said about US agricultural businesses that exports predominantly to China have grounded to a halt due to the +125% tariffs imposed.

Agri businesses’ closures will affect not just the Chinese market these farmers export to, but domestic as well. How could that be good for US economy ?

And perhaps for the first time in a long time, Americans just might celebrate Christmas this year without the required ornaments to decorate their Christmas trees at home, if the trade war drags out until end Q3 2025. (see below)

I wonder too if China might be waiting for US stores to run out of goods (without replenishing supply from China), so that people-panic will arm wrestle Trump to make the first corrective action.

Of course, this strategy will exact a lot out of China, in the tit-for-tat trade war with US.

On what was supposed to be a joyous celebration for $Apple(AAPL)$ for its Thu, 01 May 2025 quarterly earnings turned sour instead.

AAPL Q2 2025 Earnings results.

After US market closed on Thursday, Apple reported its Q2 2025 earnings that beaten LSEG’s expectations:

• Earnings per share (EPS): was $1.65 vs.$1.63 estimates vs Q2 2024’s $1.53, that’s a +7.4% YoY gain. 

• Revenue: was $95.4 billion vs $94.66 billion vs Q2 2024’s $90.75 billion. This marked a +5.12% YoY gain. 

Products’ revenue breakdown (as per StreetAccount):

• iPhone revenue: $46.84 billion vs $45.84 billion estimated vs Q2 2024’s $45.96 billion, that’s a +1.91% YoY gain. 

• Mac revenue: $7.95 billion vs $7.77 billion estimated vs Q2 2024’s $7.45 billion, that’s a +6.71% YoY gain.  

• iPad revenue: $6.4 billion vs $6.20 billion estimated vs Q2 2024’s $5.56 billion, that’s a +15.11% YoY gain. 

• Wearables, Home, & Accessories revenue: $7.52 billion vs $7.95 billion estimated vs Q2 2024’s $7.91 billion. This marked a marginal decline of -4.93% YoY loss. 

• Services revenue: $26.65 billion vs $26.70 billion estimated vs Q2 2024’s $23.87 billion, that’s a +11.65% YoY gain. 

• Gross margin: 47.1% vs 47.1% estimated.

Who would have thought that with a credible earnings report card out, AAPL price would still tanked.

Well, it was because Guidance / outlook for Q3 2025 was muddled and AAPL is not to be blamed.

What CEO (Tim Cook) & CFO (Kevn Parekh) said:

• AAPL experienced “limited tariffs impact” in its March quarter because it was able to optimize its supply chain.

• Overall revenue for FY 2025 and current quarter will be “low to mid-single digits”.

Q3 2025 Guidance.

• Revenue (estimates): will be $89.45 billion vs Q3 2024’s $85.78 billion, that is a +4.28% YoY gain.

• Earnings per share (estimates): will be $1.48 per share vs Q3 2024’s $1.40, that is a +5.71% YoY gain.

• Gross margin (estimates): to be at 46% at the midpoint, taking into account tariff costs.

What market didn’t want to hear.

• Apple’s stock price dropped because CEO said Trump’s tariffs will increase Apple’s costs by $900 million for current quarter.

• And that is under the assumptions that (a) no more new tariffs and (b) no additional major change/s taking place.

It is this that got Wall Street and investors nervous, leading to a fall in its future price.

With an anticipated fall in US Non-farm payroll (for April 2025) and over a weekend Friday, AAPL should be closing on a lower note.

Must Read: Click on below titles to access. Repost to share, Like as encouragement ok. Thanks.

• Investors Alert - If US faces Stagflation !

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• LUMN, COMM, FUBO: 3 Stocks Billionaires buy.

• Do you think AAPL has reported a relatively stellar set of results ?

• Do you think AAPL is not to be blamed when CEO talked about the $900 millions ‘loss’?

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