What's going on?

US trade tariffs on China have hit a bum note with Sonos: the American smart speaker company warned this week that its 2020 earnings might not sound too great.

What does this mean?

The trade war�s made a lot of noise lately, and it�s been US companies who�ve had to face the music. That�s because American tariffs on Chinese-manufactured goods � both those already introduced and those kicking in next month � affect a host of products, including consumer electronics like Sonos�s speakers.

Those increased costs have left Sonos with a tricky choice: either the company itself covers them, or its customers do in the form of higher prices � in turn putting demand at risk. That probably won�t sit right with Sonos, which faces stiff competition from Apple, Google, and Amazon�s smart speakers. Even so, the company has its ears on the prize: it views competitors� products as �stepping stones� to its own premium offering, and it�s now bought Snips � a French privacy-focused AI voice platform � to better compete (tweet this).

Why should I care?

For markets: Trade snore.
The trade war�s cast a long shadow over global stock markets lately, which are spooked by the risk of Sonos-esque profit warnings. But Asian markets fell on Thursday morning as investors weighed the impact of a US Congress bill supporting Hong Kong�s protestors. That could further hurt US-China relations and make a trade deal less likely.


Zooming out: Lucky Apple.
The US president is reportedly considering exempting tech giant Apple from the next round of China tariffs. The company�s size might explain its special treatment: as the biggest public company in the US, it�s of massive importance to the country�s stock market. The US president might also want to avoid hurting consumers in the coming holiday season � especially with his big reelection bid coming up next year.