Don’t let tariff impacts derail your tech strategy

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Summary

  • How tech leaders can stay ahead and build a buffer for surprises
  • A reminder: Collaborate to move forward faster
  • Right now: Focus on near-term exposures and look for opportunities
  • In the near-term: Make smart adjustments
  • Longer term: Build in agility and resilience

President Trump’s tariff strategy continues to introduce new waves of uncertainty for global businesses. As companies contemplate rising costs and the potential for operational disruption, tech leaders – especially CIOs and CTOs – are having to revisit their 2025 technology budgets, many of which were already set. 

If you’re managing tech spend, it’s time to get ahead of the tariff ripple effects. Staying flexible, focused on value and ready to adapt will be key. 

Technology leaders face four key areas of exposure: 

  • Higher direct costs: New tariffs could raise prices on imported hardware, infrastructure and other tech components. 

  • Supply chain disruptions: If US inventories run low, companies may face delays or struggle to find new suppliers.

  • Rising indirect costs: Cloud, software or IT service vendors may increase prices to offset their own rising costs.

  • Global shifts in tech spend: Shifting cost dynamics may prompt companies to redirect tech investments globally – especially if total cost of ownership in regions like the EU drops relative to that of the US.  

There may also be opportunities for you to reduce or eliminate tariffs through US or global customs programs. With so much in play, now is the right time to plan your approach. 

Also keep in mind: Other countries may respond with their own retaliatory tariffs on US exports, adding more uncertainty – and possibly affecting tech services as well. In particular, as EU regulators continue to ramp up their efforts to provide more oversight to the biggest tech companies, the Trump administration has said it might retaliate if US companies are targeted. Uncertainty is likely the norm for some time to come.

Don’t let tariff impacts derail your tech strategy

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Example pattern for mobile
Example pattern for desktop

 

Summary

  • How tech leaders can stay ahead and build a buffer for surprises
  • A reminder: Collaborate to move forward faster
  • Right now: Focus on near-term exposures and look for opportunities
  • In the near-term: Make smart adjustments
  • Longer term: Build in agility and resilience

5 minute read

April 6, 2025

President Trump’s tariff strategy continues to introduce new waves of uncertainty for global businesses. As companies contemplate rising costs and the potential for operational disruption, tech leaders – especially CIOs and CTOs – are having to revisit their 2025 technology budgets, many of which were already set. 

If you’re managing tech spend, it’s time to get ahead of the tariff ripple effects. Staying flexible, focused on value and ready to adapt will be key. 

Technology leaders face four key areas of exposure: 

  • Higher direct costs: New tariffs could raise prices on imported hardware, infrastructure and other tech components. 

  • Supply chain disruptions: If US inventories run low, companies may face delays or struggle to find new suppliers.

  • Rising indirect costs: Cloud, software or IT service vendors may increase prices to offset their own rising costs.

  • Global shifts in tech spend: Shifting cost dynamics may prompt companies to redirect tech investments globally – especially if total cost of ownership in regions like the EU drops relative to that of the US.  

There may also be opportunities for you to reduce or eliminate tariffs through US or global customs programs. With so much in play, now is the right time to plan your approach. 

Also keep in mind: Other countries may respond with their own retaliatory tariffs on US exports, adding more uncertainty – and possibly affecting tech services as well. In particular, as EU regulators continue to ramp up their efforts to provide more oversight to the biggest tech companies, the Trump administration has said it might retaliate if US companies are targeted. Uncertainty is likely the norm for some time to come.

How tech leaders can stay ahead and build a buffer for surprises

Now is the time to assess risks, opportunities and potential impacts, align on near-term responses, and build in flexibility and contingencies to navigate what’s ahead. 

1. A reminder: Collaborate to move forward faster

Bringing together the right team of leaders from your organization and key suppliers from the start can help you get a fuller picture, faster. Alignment from the start can aid in decision-making and a more coordinated response across the business.

  • Engage cross-functionally. Work with other leaders across the company to fully evaluate the impacts, consider interdependencies (e.g., tax, inventory) and develop solutions that make sense for the organization.

  • Talk to key suppliers. Discuss locking in pricing, expediting shipments or adjusting delivery timelines.

  • Loop in your C-suite early and often. Make sure leadership understands the challenges ahead and interdependencies with other parts of the organization so they can support your planned actions. 

 

2. Right now: Focus on near-term exposures and look for opportunities

Conduct a focused risk assessment of your current technology investments and exposure points to identify areas of immediate vulnerability. 

  • Inventory your tech/capex pipeline. Look at high-spend categories to pinpoint areas most exposed to supply chain or market disruptions.

  • Flag US-based deployments. Assess location-specific risks, particularly where timing or geopolitical factors may have an impact.

  • Analyze third- and nth-party dependencies. Look to uncover critical vendor exposure and potential cascading impacts.

  • Check your current equipment and open orders. Decide whether it makes sense to stockpile key items.

  • Examine your competitive landscape. Understand how competitors (and competitors’ offerings) may be impacted. Your operating model may allow for market opportunities.

  • Review customs opportunities. With the new US tariffs, there may be new opportunities to reduce or eliminate some through US or global customs programs.  

 

3. In the near-term: Make smart adjustments

As cost pressures and uncertainty rise, continuously reassess priorities and timing across your portfolio with your supply chain in mind. This is unlikely to be a static event; building out routine processes to reassess more often can help you find advantage.

  • Revisit project timelines. Identify where supply or pricing issues may delay key initiatives and model downstream impacts.
  • Reassess your active project portfolio.
    • Accelerate high-priority, time-sensitive efforts that deliver the greatest business value – particularly those tied to strategic growth, competitive advantage or essential transformation goals. At the same time, maintain continued focus on projects that address critical compliance, regulatory, risk mitigation or supply chain needs where delay could introduce greater exposure.
    • Pause or defer lower-priority projects that carry increased execution risk or cost uncertainty.
    • Reevaluate "business as usual" activities to align better with today’s constraints and emerging needs.
  • Plan for IT readiness. Assess your IT infrastructure and capabilities to determine how ready they are to handle potential spikes in demand or rapid shifts in business operations without delays or disruption.
  • Drive productivity with AI. Focus on gaining more IT productivity by identifying opportunities to automate workflows, streamline operations and leverage AI enablers –helping offset rising costs while boosting efficiency.
  • Review major contracts. Look across key technology areas – such as cloud services, hardware and managed services – to identify where pricing models, delivery timelines or vendor commitments may be vulnerable. Consider negotiating rate locks, adding service-level flexibility or including tariff pass-through clauses.  
  • Reevaluate hardware lifecycle strategies. Consider delaying refresh cycles and increasing the use of existing equipment. If you do elect to delay, consider stockpiling spare parts for older gear.
  • Review bills of materials and architecture. Review for cost-effective design or configuration changes.

 

4. Longer term: Build in agility and resilience

Use this moment to rethink your exposure across your global footprint and supply chain. Given the level of forward-looking uncertainty, a review now can help catalyze long-term resilience against additional future shocks.

  • Reassess shipment and deployment models. This can help reduce geographic concentration risk.

  • Explore geographic hedging. Consider how adjusting your global footprint – across both talent and infrastructure – can help mitigate localized disruption.

  • Add cost flexibility wherever possible. Think licensing, cloud usage and service models.

America in motion: Own your next move 

Executives will want to sort through the president’s latest moves to get a sense of what may be next, what changes mean for their business, where to find opportunity and how to mitigate risk.  At PwC, we’re working with CIOs, CTOs and the broader C-suite across industries to navigate these changes and shape strategic response, rather than simply react: 

  • Prioritize tech investments and build in budgetary headroom with a Fit for Growth lens. 

  • Build resilience into projects and operational programs. 

  • Explore customs programs that could reduce, or potentially eliminate, some tariffs.

  • Use scenario-based tools to analyze data and interdependencies, quantify impact and inform decisions. 

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