Bloomberg says companies are eating the tariff costs, which means we may need to prepare for some margin compression in the next earnings season from companies that are importing products to resell here.
PPI Shows Companies Eating Tariff Costs, Bloomberg Finds https://t.co/0zEcPx47q8
Core Producer Price Growth Slides To Lowest Since August As Companies Eat Tariff Costs https://t.co/hXz7Ebw7v0
According to Bloomberg and CNBC reports, many companies are currently absorbing the costs associated with the 145% tariff on Chinese goods, which took effect in April 2025. Despite initial expectations that businesses would raise prices to offset these tariffs, data from the Producer Price Index (PPI) indicates that companies have been eating the tariff costs for eight consecutive months, leading to ongoing margin pressures. Core producer price growth has declined to its lowest level since August 2024, reflecting this trend. Analysts suggest that this sustained absorption of tariff expenses may result in margin compression for companies that import products for resale in the United States during the upcoming earnings season.
