Big Tech can breathe a sigh of relief — for now

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In today's newsletter, the tech industry received some welcome news over the weekend — sort of.

What's on deck

Markets: The spasm in the Treasury market last week was a warning for Trump and the US.

Tech: Microsoft just tapped the brakes on its AI data center expansion. Is that a bad sign?

Business: Elon Musk's marketing strategy for Tesla made showrooms a "sitting duck" for protesters.

But first, Big Tech dares to dream.

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The big story

Tech relief?

Confusion abounds this morning. On Friday, the US Customs and Border Protection said devices like smartphones, computers, and memory chips would be exempt from higher tariffs.

"This is the dream scenario for tech investors," Dan Ives, the global head of technology research at Wedbush Securities, posted on X. "Smartphones, chips being excluded is a game-changer scenario when it comes to China tariffs."

Global tech titans breathed a sigh of relief … for a moment.

Trump took to Truth Social on Sunday with some clarifications. "NOBODY is getting 'off the hook'," he wrote, adding: "Especially not China which, by far, treats us the worst!"

Trump denied there were ever actually exemptions from tariffs because a previous tariff is still in place. "There was no Tariff 'exception'," Trump wrote. "These products are subject to the existing 20% Fentanyl Tariffs, and they are just moving to a different Tariff 'bucket.'"

Commerce Secretary Howard Lutnick echoed Trump's comments during an interview with ABC News on Sunday, saying that tech products would be subject to tariffs after an investigation into the effect importing vital tech components has on national security

So, not quite an exemption — but exempt-ish.

It was still welcome news for Big Tech.

As chaotic as the messaging over the weekend was, certain tech products are no longer exposed to the 145% reciprocal tariff on China.

US stock futures are up early Monday, with both the S&P 500 and Nasdaq rising as much as 1.4%. Apple is up more than 5% in premarket trading.

3 things in markets

1. A historic week for markets. Stocks plunged and soared every day last week as Wall Street tried to gauge the impact of Trump's shifting tariffs. BI recapped investors' roller coaster ride.

2. The bond market has flashed a warning sign for the US and Trump. Intense volatility in the usually safe bond market put pressure on President Trump to partly pause the trade war last week. A sell-off in US Treasurys pushed bond yields to their highest level since January.

3. A top strategist is waiting for a stock surge. Piper Sandler's Craig Johnson isn't backing down from his high price target for the S&P 500, even despite current volatility. Here's why he still expects it to surge to 6,600 by year-end.

3 things in tech

1. Vibe coding is changing the game for investors and founders. Traditionally, VCs have leaned toward software startup founders with coding expertise. Now, as AI tools pitch in, they have shifting expectations.

2. Tech investors feel a funding chill coming on. The AI boom sparked further interest in tech, but recent market turmoil is prompting some VC firms to hold back on big deals. The whole thing feels a bit like "Groundhog Day," one emerging fund manager told BI.

3. Microsoft took its foot off the AI accelerator. Should we be worried? Microsoft has backed away from data center expansion even though the pace of AI investment hasn't slowed a bit. The move is a troubling step, but it's a strategic recalibration, not a retreat, BI's Alistair Barr writes.

3 things in business

1. Tesla's big blue blunder. Elon Musk's marketing strategy of putting Tesla showrooms in the middle of cities' liberal enclaves has now backfired big-time. Being in high-traffic zones has made the showrooms a sitting duck for protesters.

2. It's easier than ever for businesses to jack up prices. Thanks to a whipsawing economy and modern technology, businesses can now change prices at the drop of a hat. Consumers don't always know why the hikes are happening — and they're exhausted.

3. Teens still <3 Chick-fil-A. The chicken chain is teens' favorite restaurant brand, according to a recent Piper Sandler survey. Chick-fil-A has held the first place spot for seven years in a row, the investment bank told BI, consistently beating out McDonald's.

In other news

• America is losing the robot wars.
• Meta goes to trial over its acquisition of Instagram and WhatsApp.
• What boomers learned from the last recession.
• Palantir wants to poach top high school grads with a new anti-college internship: 'Skip the debt. Skip the indoctrination.'
• A video cover letter could help you stand out in a tough job market. Here's how to make one.
• How Saudi Arabia's dreams of building Hollywood in the desert fell short.
• I'm a federal employee watching colleagues get laid off by DOGE. It's been devastating — we aren't cogs, we're human beings.
• Three smart pieces of money advice for Gen Z college grads worried about the future.

What's happening today

• Goldman Sachs reports earnings.
• Trial in FTC case seeking to unwind Meta-Instagram merger.

The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York (on parental leave). Hallam Bullock, senior editor, in London. Grace Lett, editor, in Chicago. Amanda Yen, associate editor, in New York. Lisa Ryan, executive editor, in New York. Ella Hopkins, associate editor, in London. Elizabeth Casolo, fellow, in Chicago.