Consumer Tech Spending to Hit Record $537 Billion in 2025 – But Trump’s Tariffs May Threaten Growth

In 2025, American consumers are expected to spend a record-breaking $537 billion on apps, devices, and gadgets, according to the Consumer Technology Association (CTA). However, there’s a catch: Trump’s proposed tariff plans may have a significant impact on this massive spending surge.

The CTA’s Forecast for Consumer Tech in 2025

Brian Comiskey, a futurist with the CTA, revealed these projections during CES 2025 in Las Vegas. The association predicts a 3.2% increase in consumer tech spending over 2024. However, Trump’s tariff proposals could derail this growth. If implemented, the tariffs might have a damaging effect on U.S. purchasing power, leading to a potential $90-$143 billion decline in consumer tech spending.

How Tariffs Could Affect Prices

The proposed tariff hikes include a 10% or 20% tariff on imports from all countries and a 60% tariff on products from China. These tariffs could lead to significant price increases for popular tech products:

Laptops and tablets could see price hikes of 46%.
Video game consoles might become 40% more expensive.
Smartphones could increase in price by 26%.

Comiskey warned that the price increases would likely result in a steep decline in consumer spending, with tablets, laptops, gaming consoles, and smartphones seeing sales drops of up to 68%, 58%, and 37%, respectively.

The Rise of AI in Consumer Tech

Without the tariffs, however, the consumer tech industry is poised for a super cycle. New AI-powered features in devices like Apple Intelligence and Microsoft Copilot+ are driving this surge in demand. According to CTA research, consumers are increasingly adopting these new AI technologies in their everyday devices.

Many popular products, such as fitness trackers, smart TVs, and even gadgets like electronic baby rockers, are now equipped with AI technology. For instance, Google’s newly announced AI-powered smart TV at CES 2025 is one example of how AI is enhancing the consumer tech experience. Whether or not AI truly enhances the gadget’s functionality may not matter, as the novelty and innovation are driving strong consumer interest.

Gen Z’s Purchasing Power

One key factor contributing to this tech boom is the rise of Gen Z’s purchasing power. By 2025, 27% of the global workforce is expected to be made up of Gen Z, according to Udemy’s research. This generation is passionate about adopting new technology and is eager to invest in the latest gadgets, making them a major driver of consumer tech spending.

For further insights into how Gen Z is shaping the future of consumer technology, check out Udemy’s research.

Potential for Massive Growth: What Lies Ahead

While the tariffs pose a threat, the overall trend in consumer tech spending remains positive. The combination of AI-powered features, Gen Z’s purchasing power, and an influx of innovative products has the potential to fuel a record-breaking year for consumer electronics.