Chinese online retailers have cut back their spending on Facebook and Instagram ads in reaction to President Donald Trump’s tough trade policy with the country.

Meta’s finance chief Susan Li said Wednesday that “Asia-based e-commerce exporters” have reduced their spending with the social media company. It’s likely those firms did so as they prepare for the de minimis trade loophole ending this Friday, Li said during a first-quarter earnings call.

“A portion of that spend has been redirected to other markets, but overall spend for those advertisers is below the levels prior to April,” Li said.

Trump in early April signed an executive order to end the de minimis trade exemptions for Chinese imports, which benefited online retailers like Temu and Shein. Analysts have said they believe that Temu and Shein make up the bulk of Meta’s 2024 China-related sales of $18.35 billion.

Meta’s advertising sales in the Asia-Pacific region were $8.22 billion for the first quarter, the company said. That was below Wall Street projections of $8.42 billion.

Li said that Meta’s second-quarter revenue would come in the range of $42.5 billion to $45.5 billion, which was in line with analysts expectations of $44.03 billion.

“It’s very early, hard to know how things will play out over the quarter, and certainly, harder to know that for the rest of the year,” Li said.

This echoes what Google said last week during its earnings call, warning that it expects headwinds to its advertising business, particularly from the Asia-Pacific region. Similarly, Snap on Tuesday said it had “experienced headwinds to start the current quarter.”

Trump’s China tariffs of 145% also appear to be impacting Meta’s Reality Labs unit, which creates virtual reality and augmented reality devices.

Reality Labs had an operating loss of $4.2 billion while bringing in $412 million in sales during the first quarter.

Meta said its 2025 capital expenditures will come in the range of $64 billion to $72 billion, which is higher than its prior outlook of $60 billion to $65 billion.

“This updated outlook reflects additional data center investments to support our artificial intelligence efforts as well as an increase in the expected cost of infrastructure hardware,” the company said in the earnings release.

Regarding the higher costs of infrastructure hardware, Li told analysts that it’s the result of “suppliers who source from countries around the world.” The higher cost of infrastructure hardware and “higher expected Reality Labs cost of goods sold” has “partially offset” Meta’s lowered projected range for its 2025 total expense, she said.

“There’s just a lot of uncertainty around this, given the ongoing trade discussions,” said Li, adding that Meta is modifying its supply chain as a result.

WATCH: Meta is showing tangible examples of AI investment.

President Trump’s tariffs have dominated global news headlines for weeks. During Microsoft‘s earnings call with investors on Wednesday, though, tariffs came up only once, during prepared remarks.

The reference from Amy Hood, Microsoft’s finance chief, had to do with sales of personal computers and Windows operating system licenses to other PC makers.

“Windows OEM and devices revenue increased 3% year over year, ahead of expectations, as tariff uncertainty through the quarter resulted in inventory levels that remained elevated,” Hood said.

While Microsoft does sell Surface PCs and Xbox video game consoles, impact will likely be less direct than it will be on companies that sell physical products.

Still, Microsoft does stand to see second-order effects, like other software vendors. Its clients might feel the effects of higher prices on goods imported into the U.S. and choose to soften their spending, and Microsoft does purchase equipment from other countries.

The Redmond, Washington-based company is investing heavily to buy and install the necessary Nvidia graphics processing units across the world to power OpenAI’s ChatGPT and other artificial intelligence products.

If anything, software might help companies respond in the event that their costs go up because of tariffs, CEO Satya Nadella said on the conference call

“I think if you sort of buy into the argument that software is the most malleable resource we have to fight any type of inflationary pressure or any type of growth pressure where you need to do more with less, I think we can be super helpful in that,” he said. “And so if anything, we would probably have more of that mindset is, how do we make sure we are helping our customers, and then, of course, we’ll look to
share gains.”

The company sells a slew of AI products, including the GitHub Copilot that spits out source code suggestions for developers and the Microsoft 365 Copilot assistant that answers questions in Excel, Teams and other productivity apps.

Microsoft shares traded up about 8% in extended trading after the call. The company reported higher revenue and earnings than analysts had predicted and issued an upbeat forecast.

WATCH: Corporate margins will be pressured as a results of tariffs, says Morgan Stanley’s Guerra

Apple willfully violated a 2021 injunction that came out of the Epic Games case, Judge Yvonne Gonzalez Rogers said in a court filing on Wednesday.

She wrote that Apple Vice President of Finance Alex Roman “outright lied” to the court about when Apple had decided to levy a 27% fee on some purchases linked to its App Store.

“Neither Apple, nor its counsel, corrected the, now obvious, lies,” Rogers wrote, saying that she considers Apple to “to have adopted the lies and misrepresentations to this Court.”

Rogers added that she referred the matter to U.S. attorneys to investigate whether to pursue criminal contempt proceedings on both Roman and Apple.

The decision is a striking repudiation of Apple’s conduct in the Epic Games trial, which was decided in 2021 and appealed in 2023.

While Apple won the vast majority of counts in the original trial, Epic Games did win some concessions tucked inside a 180-page order. Rogers originally ordered the company to make changes to its app store, allowing software developers to link to their websites inside of iPhone apps for customers to make purchases outside of Apple’s ecosystem.

On Wednesday, Rogers accused Apple of willfully trying to violate her ruling, and she held the company in contempt.

Rogers wrote that it was expected under her ruling that those kind of off-app purchases would not have an Apple commission. But Apple introduced new policies in 2024 that collected a 27% commission from some of those purchases, only a slight discount from the 30% Apple usually collects from in-app purchases. Rogers said nearly every Apple decision on its app-linking policies was anticompetitive.

Rogers wrote that Apple presented evidence to the court of internal deliberations about its rule that were “tailor-made for litigation,” instead of the company’s actual internal discussions.

“In stark contrast to Apple’s initial in-court testimony, contemporaneous business documents reveal that Apple knew exactly what it was doing and at every turn chose the most anticompetitive option,” Rogers wrote. “To hide the truth, Vice-President of Finance, Alex Roman, outright lied under oath.”

Rogers also accuses Apple of withholding documentation of a June 2023 meeting including CEO Tim Cook about how they would comply with the 2021 court order. Rogers said that Apple hid the existence of the meeting from the court until 2025. She also said that Apple abused privilege in order not to share documents that it was supposed to.

Apple had a “a desire to conceal Apple’s real decision-making process, particularly where those decisions involved senior Apple executives,” Rogers wrote.

Former Apple senior vice president and current fellow Phil Schiller did not want Apple to take a commission on web links, but Cook ignored him, Rogers said.

“Cook chose poorly,” Rogers wrote.

The judge ordered, effective immediately, for Apple to stop imposing its commissions on purchases made for iPhone apps through web links inside an app. She also ordered Apple to pay Epic Games’ attorney fees over this specific issue.

“This is an injunction, not a negotiation. There are no do-overs once a party willfully disregards a court order,” Rogers wrote.

An Apple representative did not respond to a request for comment. Roman didn’t immediately respond to a message.

“It’s a huge victory for developers, and it means all developers can offer their own payment service side-by-side with Apple’s payment service,” said Epic Games CEO Tim Sweeney on a call with reporters on Wednesday. “This forces Apple to compete. This is what we wanted all along.”

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