BofA Securities said e-commerce software vendors are most exposed after President Donald Trump announced tariffs on trading partners, including China and Taiwan.

Analysts led by Brad Sills said the U.S. administration announced a minimum 10% tariff will be imposed on all countries and additional reciprocal tariffs will be applied to many countries.  The administration also said that the di minimis exemption for China and Hong Kong will be ending on May 2.

The de minimis exemption is a rule where imported packages of less than $800 in value have minimal custom declaration requirements compared to packages more than $800. The rule makes it much easier to drop ship products directly from international manufacturers to consumers in the US. Packages originating from China and Hong Kong are now subject to duties of various rates, the analysts added.

The analysts believe eliminating the di minimis exemption increases Shopify’s (NASDAQ:SHOP) tariff exposure. They estimate Shopify’s average order size to be $170. The U.S. represents 50% to 60% of total gross merchandise value, or GMV, in FY24. Based on U.S import mix by countries, the analysts estimate that imports from China represent 25% of US GMV, Mexico represents 16%, Canada represents 8%, and the EU represents 9%.

The analysts estimate that Salesforce’s (NYSE:CRM) Commerce Cloud represents 7.5% of total subscription revenue in FY25, with a similar international to US mix as Shopify. Adobe’s (NASDAQ:ADBE) direct exposure through eCommerce/Magento is less than 1% of the digital experience revenue.

However, the analysts added that Adobe’s creative business is indirectly tied to eCommerce (means, more eCommerce activity drives the need for more digital content) and could see some negative impact.

Sills and his team believe Global-e Online (NASDAQ:GLBE) exposure is low, as BofA estimates about 1% of its GMV originates from China/HK and ends up in the U.S. Other e-commerce software vendors with higher risk from the tariffs in BofA' coverage include BigCommerce (NASDAQ:BIGC) and Lightspeed Commerce (NYSE:LSPD) according to the analysts.

In addition, the analysts said that they see large-scaled software businesses with manufacturing representing 5% to 10% of total revenue. Those include Microsoft (NASDAQ:MSFT) (Azure,Office, Server, Windows PCs), Oracle (NYSE:ORCL) (database/infrastructure and applications), Autodesk (NASDAQ:ADSK) (design software), ServiceNow (NYSE:NOW) Adobe, Workday (NASDAQ:WDAY), HubSpot (NYSE:HUBS) (smallmanufacturers), Intuit (NASDAQ:INTU) (QuickBooks and Mail Chimp).

Advertising budgets are also at risk because of their discretionary nature. In 2024, the automotive, consumer, and retail verticals accounted for 26% of Zeta Global’s (NYSE:ZETA) revenue, the analysts added.

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