The American shopper is beginning to feel the first sting of President Donald Trump’s aggressive tariff war on Chinese imports, with fast-fashion giants Shein and Temu recording double-digit sales declines in the wake of sweeping tax hikes.

After months of rising tensions and rhetoric over trade imbalances, Trump’s move to eliminate the de minimis rule, long used by Chinese retailers to ship low-value goods to the U.S. duty-free, has begun to bite. The initial casualty: low-cost online shopping, a category dominated by Shein and Temu.

According to transaction data tracked by Bloomberg Second Measure, Shein’s U.S. sales plummeted by 23 percent between April 25 and May 1, compared with the week prior. Temu, owned by Chinese e-commerce giant PDD Holdings, experienced a 17 percent drop in the same period. The downturn came immediately after both companies began raising prices to offset the newly imposed import tariffs.

This marks a sharp reversal from the retail boom seen in March and early April, when price-conscious consumers rushed to stockpile cheap clothing, gadgets, and kitchen items ahead of the expected price surge. Now, the cost of inflation is no longer theoretical—it’s showing up in shopping carts.

The blowback stems from Trump’s dismantling of the de minimis loophole, which previously allowed shipments under $800 to enter the U.S. free of duties. With that lifeline gone, Temu and Shein face an entirely different business calculus. Trump has also hiked tariffs on a range of Chinese imports, some up to 145 percent, drastically reshaping the pricing structure for thousands of products sold online.

Both platforms raised prices from April 25, a move that immediately cooled consumer enthusiasm. Temu, which had based its explosive growth on ultra-low prices for China-made goods, passed on almost all the new tax costs to buyers. In some cases, the price of items doubled overnight.

Bloomberg’s product pricing tracker reveals that Shein’s top 100 beauty and health items more than doubled in price compared to April 15. Toy and game categories rose by over 60 percent, home and kitchen goods saw a 40 percent bump, while women’s clothing increased 10 percent on average.

The effect isn’t limited to consumer pain. Shein’s long-anticipated IPO is now reportedly in doubt. The company is reassessing its U.S. market strategy amid regulatory uncertainty and the impact of tariff-induced operating costs.

Temu’s Strategic Pivot

For Temu, the path forward appears to be a pivot away from Chinese imports entirely. The company is now embracing a “local fulfilment” model, prioritizing inventory sourced from U.S.-based merchants to sidestep import taxes.

Since April 25, Temu has flooded its bestseller pages with goods warehoused domestically. Bloomberg data shows hundreds of items are now marked as “locally shipped” from April 30 onwards. These goods have remained stable in price, shielded from the latest wave of trade penalties.

The shift is dramatic for a company that scaled through cross-border shipping logistics, offering products as low as $1 direct from Chinese factories. Now, it’s effectively rewriting its playbook to survive in a more protectionist U.S. trade environment.

Retailers Caught in the Middle

The pressure isn’t limited to Chinese platforms. Major U.S. retailers like Walmart and Target have yet to raise prices, but behind the scenes, supply chains are straining. Chinese suppliers, many of whom provide private-label goods to American chains, are beginning to balk at absorbing the cost of the tariffs. If they hold the line, prices will inevitably rise for U.S. consumers, or profit margins will erode.

Amazon is already walking a tightrope. After a public complaint from Trump, the company opted not to display tariff charges on its site, a move that underscores the growing unease among retailers. They are now faced with two unattractive options: absorb the cost themselves or push it onto shoppers who are already struggling with high living costs.

U.S. consumer confidence fell to its lowest level in nearly five years in April, according to recent sentiment data. With inflationary pressures expected to intensify in coming months, and more tariffs potentially in the pipeline, the worst may not be over.

What was once a niche debate about import rules has now exploded into a nationwide consumer issue. And with platforms like Shein and Temu serving millions of Americans each month, the fallout from Trump’s tariff hikes is becoming increasingly difficult to ignore.

Apple is reportedly exploring ways to reshape its Safari browser to prioritize AI-powered search engines, a decision that could disrupt Google’s dominance over one of the most lucrative corners of the internet economy.

While no final announcements have been made, the mere suggestion that Apple is actively eyeing this change has already sent tremors through the market.

According to Bloomberg, Apple’s services chief Eddy Cue testified in federal court this week, revealing that the company is preparing to welcome AI search tools like OpenAI and Perplexity into the Safari ecosystem. Though they may not become the default overnight, Cue hinted it’s only a matter of time before these tools are added as user-selectable options.

The courtroom moment wasn’t just about Apple’s future search plans; it also brought into sharp relief the weakening grip of Google’s long-standing search empire. For years, the tech giant has paid Apple tens of billions of dollars to remain the default search engine on Safari, a deal that secures Google’s place in front of hundreds of millions of iPhone users worldwide. Google pays the iPhone maker billions of dollars per year, as much as $20 billion per year back in 2022, according to testimony in the trial, to be the default search engine on iPhones.

But now, cracks are appearing in that arrangement.

Cue admitted that Safari search traffic declined in April for the first time, a landmark shift he blamed on users increasingly favoring AI tools over traditional search engines. That decline, even if modest, points to a change in user behavior that could threaten Google’s dominance from within one of its most lucrative channels.

Alphabet shares plunged more than 7% on the news, while Apple’s stock dipped about 2%. The market reaction wasn’t just to the decline in traffic or Cue’s comments; it was about what this could mean in the long run. If Safari, which commands a significant portion of mobile browsing, begins to shift its search ecosystem toward AI, Google could face serious consequences, not just in terms of traffic but in advertising revenue and user data.

Tech investors are already jittery. “The loss of exclusivity at Apple should have very severe consequences for Google even if there are no further measures,” said D.A. Davidson analyst Gil Luria. “Many advertisers have all of their search advertising with Google because it is practically a monopoly with almost 90% share. If there were other viable alternatives for search, many advertisers could move much of their ad budgets away from Google to these other venues.”

For now, Cue has maintained that Google remains the preferred default, at least until a better option emerges. But even his own statements betray a growing sense of inevitability.

“We will add them to the list — they probably won’t be the default,” Bloomberg quoted Cue as saying, referring to AI-based search engines like OpenAI’s ChatGPT and Perplexity.

Ironically, Apple’s own hesitation could be the most telling sign of how serious the threat to Google really is. Cue reportedly acknowledged that he’s lost sleep over the prospect of walking away from the revenue-sharing deal with Google. But Apple’s deal with OpenAI to integrate ChatGPT into Siri, and its ongoing talks to potentially add Google’s Gemini AI as well, suggest that the company is positioning itself to play all sides in the coming AI search war.

Google, meanwhile, is trying to stem the tide. Last month, it reassured investors that its AI investments are beginning to deliver results, pointing to stronger-than-expected first-quarter earnings. But that may not be enough. As the Justice Department’s antitrust trial against Alphabet intensifies, the scrutiny surrounding Google’s search monopoly is deepening, and Apple’s evolving stance could become the turning point in the case.

In many ways, Apple’s Safari rethink is more than just a user experience redesign. It’s a carefully timed maneuver — one that hints at a broader strategic pivot. By opening the door to new AI search engines, Apple is not just testing the waters; it’s signaling to the industry that the age of Google’s dominance may be approaching a historic inflection point.

And it’s doing so at a time when AI, not conventional search, is rapidly becoming the first stop for users seeking answers.