Retail Giant Braces for Impact as New Trade Duties Threaten Supply Chains

Walmart has issued a stark warning that its business could be significantly affected by new tariffs that former President Donald Trump is seeking to impose, particularly if duties targeting Canada and Mexico—two of America’s largest trading partners—are implemented.

The warning came after the retail giant released its quarterly earnings report, which showed slowing profit growth. The announcement rattled investors, leading to a 6% drop in Walmart’s stock price during a broader market decline.

In an interview with CNBC, Walmart’s Chief Financial Officer John David Rainey acknowledged that while the company sources two-thirds of its products from the U.S., it is “not going to be completely immune” from trade duties and their inflationary effects.

“We’ve lived in a tariff environment for the last seven or eight years, and we’ll do what we know how to do,” Rainey said. “We’ll work with suppliers. We’ll lean into our private brand. We’ll shift supply where necessary to try to take advantage of lower costs that we can then pass on to consumers.”

However, he admitted that Walmart could not fully shield consumers from price hikes, emphasizing that tariffs typically lead to higher costs across the supply chain.

“There will likely be cases where prices for consumers will increase as a result of tariffs,” Rainey added, noting that such policies are “inflationary” for shoppers.

Trump’s Tariffs Could Reshape U.S. Trade and Retail Costs

Trump has proposed an expansive list of tariffs, which, if fully implemented, could significantly disrupt global supply chains and raise costs for U.S. businesses and consumers. These proposed tariffs include:

• A 10% across-the-board tariff on all imported goods
• Higher duties on steel, aluminum, automobiles, drugs, semiconductors, and lumber
• New trade penalties targeting China, Canada, and Mexico

So far, only a supplemental 10% duty on Chinese goods has gone into effect, but Trump has repeatedly threatened to expand the list of affected goods and countries depending on ongoing trade negotiations.

While Trump has framed the tariffs as a strategy to protect American jobs and industries, economists warn that the real impact could be inflation, slower economic growth, and increased costs for businesses and consumers.

Historically, tariffs have functioned as a hidden tax, raising the price of imported goods. Since many U.S. manufacturers rely on imported materials, businesses often pass the added costs down to consumers.

A recent report from the Peterson Institute for International Economics estimated that Trump’s proposed 10% universal tariff would cost the average U.S. household an additional $1,500 per year due to price increases across various goods, including electronics, vehicles, and food.

The concern is so widespread that the Federal Reserve has now factored tariff risks into its economic outlook.

This week, the Fed acknowledged that rising tariffs were part of its reasoning for keeping interest rates elevated, as trade policies could exacerbate inflation.

The Fed noted that business contacts in a number of Districts had indicated that firms would attempt to pass on to consumers higher input costs arising from potential tariffs.

In its “upside risks to the inflation outlook”, the central bank specifically cited “the possible effects of potential changes in trade and immigration policy.”

U.S. Companies Brace for Disruptions

Beyond Walmart, major U.S. companies are scrambling to assess how Trump’s tariffs could impact their operations.

According to CNBC data, the word “tariffs” has been mentioned in over 190 earnings calls held by S&P 500 companies in 2025, a frequency not seen in nearly five years.

While some businesses—particularly those in manufacturing and retail—expect direct cost increases, others are worried about the broader economic slowdown that could result from higher consumer prices.

“We’ve game-planned out several scenarios and steps we could take depending on what actually goes into effect,” said Cisco CFO R. Scott Herren, whose company depends on imported electronic components.

Will Consumers Pay the Price?

For Walmart and other major retailers, the challenge now is finding ways to minimize the cost burden on consumers.

Some of the strategies being explored include:

• Sourcing goods from lower-tariff countries
• Expanding private-label brands to replace expensive imports
• Negotiating price adjustments with suppliers

However, many industry analysts remain skeptical that these measures will be enough to completely offset the cost increases.

As one of the largest retailers in the world, Walmart’s response is expected to serve as a key indicator of whether tariff-induced inflation will trickle down to everyday shoppers—and just how much of the burden they will be forced to bear.

Tesla is facing mounting boycott calls in Malaysia, as outrage spreads over CEO Elon Musk’s support for U.S. President Donald Trump, particularly in light of Trump’s controversial plan for Gaza, which could lead to the displacement of millions of Palestinians.

The backlash in Malaysia—one of Southeast Asia’s most vocal pro-Palestinian nations—underscores the growing risks of Musk’s political entanglements for Tesla’s business, particularly in international markets where perceptions of U.S. foreign policy play a major role in consumer sentiment.

Per SCMP, Malaysians took to social media to denounce Tesla after its launch of the Model Y “Juniper” earlier this week, branding the vehicle a “swasticar”—a term that originated in Europe following Musk’s hand gestures during Trump’s inauguration last month, which many perceived as resembling a Nazi salute.

“Not touching this swasticar,” wrote a user named Adnan Abdullah in response to a Facebook post by a Malaysian car review site regarding the Tesla Model Y launch.

The controversy surrounding Musk’s gesture quickly spread beyond the West. In London, activists pasted stickers reading “Don’t buy a swasticar” on hundreds of Teslas, according to a Newsweek report—and the slogan has now made its way to Southeast Asia.

The Tesla backlash in Malaysia intensified after Trump announced on February 4 that his administration was considering a U.S.-led reconstruction of Gaza, proposing to turn the war-ravaged strip into the “Riviera of the Middle East” while forcibly relocating Palestinians to Egypt and Jordan.

“Palestinians won’t have a right to return,” Trump declared. “Because they’re going to have much better housing.”

The proposal sparked global condemnation, particularly in Malaysia, which has long been one of the strongest supporters of the Palestinian cause. Prime Minister Anwar Ibrahim has positioned himself as Southeast Asia’s leading voice against Israel’s war on Gaza, calling out Western powers—including the United States—for enabling Israeli aggression.

Against this backdrop, Musk’s close alignment with Trump has deeply damaged Tesla’s image in Malaysia, where consumers have vowed to boycott the brand.

“Will never support a company that planned to displace Palestinians from Gaza. Vote with our money,” wrote a user named YH Chin on Facebook.

Some compared Tesla to Nazi-era German carmakers, drawing historical parallels between Musk’s ties to Trump and Volkswagen’s origins under Hitler.

“The new Nazi car. Racists and Betas will love it,” wrote Prabha Krishnan, referencing a term popular among incel communities to describe submissive males.

Tesla’s Malaysia Business at Risk Amid Growing Competition

The controversy comes at a precarious time for Tesla in Malaysia, where the company has struggled to gain a foothold against Chinese electric vehicle (EV) manufacturers. Tesla officially entered Malaysia in July 2023, launching its first showroom and customer experience center in Southeast Asia.

However, despite initial strong demand, Tesla has fallen behind Chinese EV brands, which offer cheaper and more accessible alternatives. BYD, China’s top EV maker, outsold Tesla in Malaysia in 2024, registering 8,750 units compared to Tesla’s 5,137 units, according to the Malaysian Road Transport Department.

The boycott movement could further erode Tesla’s market share at a time when Chinese brands like BYD and Xpeng, as well as local automakers Proton and Perodua, are ramping up EV production.

For Tesla owners in Malaysia, the controversy raises safety concerns, as some fear that their vehicles could become targets of vandalism.

“I think Tesla and Musk are intertwined, and the fact that Musk is spending a lot of time and energy doing non-Tesla things isn’t good for Tesla,” said a Malaysian Tesla owner, who requested anonymity due to concerns over possible reprisals.

Malaysia has set a goal of transitioning 70% of privately owned vehicles to EVs by 2050, but analysts believe that if Tesla’s reputation continues to suffer, Chinese brands could dominate the market instead.

“A Tesla boycott might slow Malaysia’s EV adoption in the short term,” the owner added. “But brands like BYD, Xpeng, and even Proton and Perodua will eventually fill the gap.”

Musk’s Political Ties Threaten Tesla’s Global Sales

Tesla’s Malaysia backlash is just the latest in a string of challenges linked to Musk’s increasingly politicized public persona.

Since becoming a major donor to Trump’s re-election campaign, Musk has cemented his role as a key adviser to the U.S. president, drawing backlash from liberals, anti-fascist activists, and international markets wary of Trump’s policies.

Beyond Southeast Asia, Tesla’s global sales have been plummeting. Recent full-year and January sales reports from key markets suggest a steep decline, even with the Cybertruck launch—which was expected to boost U.S. sales.

Musk’s erratic behavior and political affiliations have alienated a significant portion of Tesla’s traditional customer base, including many in Democratic-leaning states in the U.S. and international markets with strong anti-Trump sentiment.

The growing calls to boycott Tesla in Malaysia could hamper the company’s long-term ambitions in Southeast Asia, particularly as competitors capitalize on the controversy. With Tesla already struggling to compete against cheaper Chinese EVs, Musk’s close ties to Trump are now compounding the problem, alienating consumers in a country where political sentiment heavily influences purchasing decisions.

The global AI industry was thrown into turmoil in January 2024 when DeepSeek, a Chinese artificial intelligence company backed by hedge fund High-Flyer, released R1, a powerful open-source reasoning model.

What made R1 revolutionary was not just its capabilities, but the fact that it had been developed using significantly weaker chips and a fraction of the funding used by Western AI firms like OpenAI, Anthropic, and Google DeepMind.

DeepSeek’s unexpected success sent ripples across the tech industry, raising questions about whether the AI boom—fueled by the belief that bigger, more expensive computing power leads to smarter AI—was about to be disrupted by a more cost-effective approach.

Global investors reacted swiftly and dumped shares of AI chipmakers, particularly Nvidia, whose market dominance has been built on the assumption that more powerful hardware is essential for AI progress.

The result? Nvidia’s market capitalization plunged by $600 billion, the worst single wipeout in its history, and CEO Jensen Huang’s personal fortune took a nearly 20% hit.

But according to Huang, this was a massive overreaction based on a flawed understanding of how AI models work.

Huang: “Investors Took Away the Wrong Message”

During a pre-recorded interview aired as part of an event by Nvidia partner DDN to introduce its new Infinia software platform, Huang pushed back against investor fears, arguing that the market misinterpreted what DeepSeek’s achievement actually meant for AI’s future.

“From an investor perspective, there was a mental model that the world was pre-training and then inference. And inference was: you ask an AI a question, and you instantly got an answer,” Huang said. “I don’t know whose fault it is, but obviously that paradigm is wrong.”

In other words, investors wrongly assumed that AI’s reliance on high-powered computing had been fundamentally disrupted—but according to Huang, that couldn’t be further from the truth.

He explained that while DeepSeek’s R1 demonstrated that pre-training can be done with fewer resources, it does not mean AI models can function at scale without advanced computing infrastructure.

Instead, the real challenge in AI development today lies in post-training methods, which allow AI systems to refine their intelligence, improve their reasoning, and make more accurate predictions after their initial training phase.

“Pre-training is still important, but post-training is the most important part of intelligence. This is where you learn to solve problems,” Huang emphasized.

Post-training techniques—such as reinforcement learning, fine-tuning, retrieval-augmented generation (RAG), and self-improvement algorithms—are what truly make AI models more reliable, intelligent, and efficient over time.

And unlike pre-training, post-training requires even more computational power, meaning that the demand for high-performance AI chips, like those produced by Nvidia, will only continue to grow.

“Post-training methods are really quite intense,” Huang noted. “The demand for computing power will continue to grow as AI models improve their reasoning abilities.”

Why DeepSeek’s Breakthrough Isn’t a Threat to Nvidia

Rather than seeing DeepSeek R1 as a threat to Nvidia’s dominance, Huang insisted that its success was actually a positive development for the AI industry.

“It is so incredibly exciting. The energy around the world as a result of R1 becoming open-sourced — incredible,” he said.

His stance echoed that of Lisa Su, CEO of Nvidia’s biggest rival AMD, who recently addressed similar concerns by stating: “DeepSeek is driving innovation that’s good for AI adoption.”

Huang’s comments come amid an ongoing debate in the AI world about whether AI scaling—the process of improving models by using more data and computing power—is slowing down.

In late 2023, reports emerged that OpenAI’s latest advancements were hitting a plateau, leading to speculation that the AI boom might not deliver on its promise. That, in turn, raised fears that Nvidia’s AI-fueled revenue explosion could lose momentum.

But Huang has consistently pushed back against this narrative, arguing that the focus of AI scaling has simply shifted from training to inference and post-training.

“Scaling is alive and well; it has just moved beyond training,” Huang said in a previous speech.

He indicated that by focusing on post-training intelligence, improved reasoning, and self-learning models, the AI industry will continue to require powerful chips, ensuring that Nvidia’s hardware remains essential to AI progress.

What This Means for Nvidia’s Upcoming Earnings Report

Huang’s remarks come just days ahead of Nvidia’s first earnings call of 2025, scheduled for February 26.

DeepSeek’s impact has already been a major discussion point on earnings calls across the tech sector, with companies from Airbnb to Palantir addressing its implications.

With Nvidia’s dominance in AI hardware facing renewed scrutiny, Huang’s comments denote that the company will double down on post-training as a core pillar of its long-term AI strategy.

The market has already begun to correct itself, with Nvidia’s stock recovering much of its lost value.

However, the biggest test will come on February 26, when Nvidia’s earnings report will reveal whether investor fears were truly unfounded—or if the AI industry’s computing revolution is entering a new phase that Nvidia must adapt to.

The Nigerian government has officially admitted that food prices and essential commodities may never revert to pre-subsidy removal levels, despite ongoing economic reforms aimed at stabilizing the economy.

This admission was made by Sunday Dare, Special Adviser to President Bola Tinubu on Media and Public Communication, in a statement issued on Thursday.

“Yes, prices are not back to the pre-subsidy removal regime. They probably may never be. But prices of foodstuffs and other services are dropping across the board. Multiple independent market surveys have confirmed this development,” Dare stated.

Dare pointed to the latest inflation report by the National Bureau of Statistics (NBS), which claims that inflation fell from 34.8% to 24.48% following a rebasing of the Consumer Price Index (CPI).

The rebased CPI, which updates the price reference period to 2024 and the weight reference period to 2023, has been defended by the government as a necessary step to improve economic data accuracy.

According to the revised NBS report, food inflation stands at 26.08%, core inflation at 22.59%, urban inflation at 26.09%, and rural inflation at 22.15%. Dare described the rebasing as a globally accepted practice, arguing that it provides a more precise picture of the economy.

“Rebasing injects precision into policymaking by providing a panoramic view of a country’s economic terrain, exposing both its strong and weak sectors. Vital information to guide investors is also provided,” he said.

However, it is believed that the government’s inflation figures misrepresent actual market conditions.

Dare’s statement reflects a shift in government rhetoric—from promising that reforms would lead to significant economic rebirth resulting in an affordable cost of living, to now acknowledging that previous prices are gone for good. It also confirms what many Nigerians have long feared, that the economic shocks triggered by the fuel subsidy removal in May 2023 have left lasting damage, and there is little hope of a full reversal of the cost-of-living crisis.

Since taking office, Tinubu’s administration has implemented bold but painful economic reforms, including fuel subsidy removal, exchange rate unification, interest rate hikes, and tight monetary policies to curb inflation.

The government argued that the policies were necessary to free up funds for infrastructure and social programs. However, the immediate effect was a nationwide economic crisis, as transportation costs skyrocketed, making movement and logistics more expensive. The cost of goods and services surged, particularly food prices, while household incomes were eroded, leaving millions unable to afford basic necessities.

Even after months of government interventions, market realities have remained grim.

Has the Government Run Out of Options?

The admission that prices may never return to their previous levels has been interpreted by many as an admission that the government has exhausted its policy options to steer the economy out of its current turmoil.

Interest rate hikes have been implemented multiple times by the Monetary Policy Committee (MPC) to curb inflation, yet prices remain high.

However, the Tinubu administration highlighted progress in the oil sector as evidence of economic recovery.

According to Dare, Nigeria’s crude oil production has exceeded 1.75 million barrels per day, reducing the need for petroleum imports and alleviating pressure on foreign exchange reserves.

Additionally, the government cited a recent Bloomberg Africa report, which suggested that Nigeria’s economic outlook is improving and that the country could soon regain its status as Africa’s largest economy once the rebased Gross Domestic Product (GDP) figures are released next month.

“Under President Tinubu’s watch, we are seeing the headwinds abating and a new economic tailwind in favor of economic reforms,” Dare asserted.