The biggest question on Wall Street today revolved around Apple. Will the company eat the additional 10% tariff charged on assembled iPhone units imported from China, or would it pass the costs on to consumers? The 10% tariffs on another $300 billion worth of Chinese goods goes into effect on September 1st. Earlier today, we told you that TF International star analyst Ming-Chi Kuo said that Apple will “absorb” most of the tax for now. The company already eats all of the tariffs placed on certain iPhone and iPad cases shipped in from China.

The iPhone could get hit with both U.S. and Chinese tariffs

Sanford Bernstein analyst Toni Sacconaghi said today that if Apple takes the full brunt of the additional tax on the iPhone, its earnings will take a 7% hit next year and margins will decrease by 1.5 percentage points. The analyst states that Apple will have to calculate how much iPhone sales will decline if it passes the cost of the tariff onto consumers. Anything larger than a 20% drop and Apple will be better off eating the cost of the tax itself. And ironically, the analyst points out that there is a risk that China will also tax the iPhone as a U.S. import in retaliation.

Apple wasn’t the only tech firm whose stock was attacked by bears today. In fact, Apple, Microsoft, Amazon, Alphabet and Facebook shares lost a combined $162 billion in stock market value during Monday’s regular trading day. And U.S. chipmakers also took heavy hits as the escalation of the trade war means that there is no chance that Chinese manufacturer Huawei will be allowed to access its U.S. supply chain. Last year, the company spent $11 billion on parts and software in the states and that business is not going to be replaced anytime soon. Shares of memory chip manufacturer Micron declined 4.85% today; the company’s largest customer was Huawei which accounted for $200 million in sales last year.