Businesses are acting like a financial shock-absorbing cushion, taking the brunt of the impact from tariffs and sparing shoppers the worst of it—at least so far.

Recent earnings reports suggest that companies are allowing their profit margins to contract rather than passing on the full cost of import duties to customers, the Wall Street Journal reported.

Taking tariffs for the team

Carmakers have been accepting some of the most noticeable hits to their bottom lines:

• General Motors said it paid more than $1 billion in tariffs on imported cars last quarter, but hasn’t hiked prices yet to make up for it.
• Stellantis, the owner of Chrysler, Jeep, and Fiat, said tariffs shaved $350 million off its Q2 profit.
• Volkswagen said its profit plunged 29% in Q2 from 5.4 billion euros a year ago, in part due to the 1.3 billion euros in US tariffs it paid in the first half of the year.

Import-dependent shoe brands in a hypercompetitive environment also seem to be avoiding shifting the full tariff burden to shoppers. Nike said last month that tariffs would shave $1 billion off its profit this financial year. Meanwhile, tariffs prompted Nike’s rival Puma to lower prices. The German footwear purveyor front-loaded stateside orders to get ahead of impending import duties and subsequently announced sales to offload its excess inventory.

US importers, rather than foreign suppliers, appear to be the ones bearing the bulk of tariffs. The Importer Price Index—a measure of the prices US businesses pay for foreign goods—remains mostly flat, suggesting that overseas sellers aren’t giving many tariff-offsetting discounts.

Your wallet may still get squeezed. Just because companies are taking the L on tariffs doesn’t mean shoppers are entirely off the hook. Nike is raising prices, and Puma said it plans to do the same later this year. And even consumer goods giants like Walmart and Procter & Gamble warned they’re looking to charge more for their wares (the former already raised prices for some products) despite having leverage to negotiate with suppliers due to their behemoth size.—SK

World leaders tell Israel to end “humanitarian catastrophe” in Gaza. In a joint statement yesterday, the leaders of Britain, France, and Germany renewed calls for an immediate ceasefire and urged Israel to let aid into Gaza, a day after France said it would recognize Palestine as a state at the UN General Assembly this fall. Dozens of Palestinians in Gaza have died of starvation this month, according to health officials, and the UN says a third of the population hasn’t eaten in days due to a total border blockade. Earlier this week, the UN’s human rights office said Israeli forces have killed more than 1,000 Palestinians seeking aid since May, mostly around sites run by a US- and Israel-backed group called the Gaza Humanitarian Foundation. Israel denies shooting aid-seekers, and said yesterday it would soon let countries parachute aid into Gaza, which humanitarian experts criticized as insufficient.—ML

Trump heads to Scotland for EU tariff talks and golf. President Trump is in Scotland, where he’s scheduled to visit two golf courses his family owns and to meet with world leaders. It’s possible that an EU trade deal could emerge from his meeting with European Commission President Ursula von der Leyen tomorrow. The EU leader said they had “agreed to meet in Scotland on Sunday to discuss transatlantic trade relations, and how we can keep them strong,” amid reports that the two sides have been discussing a deal for 15% tariffs similar to the one the US recently made with Japan. Before boarding his plane to Scotland, Trump said the chances for a deal were “50/50.” He’ll also meet with British Prime Minister Keir Starmer to finalize a trade deal they discussed in June.—AR

Education Dept. to release $5.5 billion in frozen funds. The Trump administration said it plans to release the grant money, which had previously been approved by Congress, but was withheld from schools as part of a funding freeze at the beginning of the month while the administration reviewed the allocation. With the new school year approaching, the money will now be available to support English language instruction, adult literacy, and other programs. Another $1.3 billion of funds for after-school and summer programming was unfrozen last week. The freeze was challenged by lawsuits, and lawmakers from both parties had also urged the funds’ release.—AR

An app is on a mission to prevent women from wasting a good outfit. The Tea app, which lets women anonymously review men they’ve dated, skyrocketed to the No. 1 spot in the App Store this week. But now critics are raising the same privacy and ethics concerns that pop up whenever someone posts a screenshot of a dude who stood them up.

Only women can create accounts, and there’s currently a waitlist. Downloads have increased by 185% this month compared to the same time last year, according to Sensor Tower.

How it works: Tea vets users by asking them to upload a selfie and a photo of their ID. Women can post photos of men, with reviews ranging from bad dates to warnings that he’s a scammer. Other women can add their own experiences or react with red and green flag emoji. Some features, like background checks, are behind a paywall.

Big picture: The idea of a digital whisper network for women to warn each other about potentially dangerous men isn’t new (see: West Elm Caleb, Facebook groups, etc.), but the app’s popularity shows there’s still a demand. However, Tea’s efforts to protect women have already backfired with a recent data breach that exposed users’ IDs.—MM

Bad news if you happen to have a pulchritudinous Warhol hanging in your bedroom that you were hoping to cash out: Auction sales at heavy-hitters Sotheby’s, Christie’s, and Phillips fell to $3.98 billion over the first half of the year, representing a 6% drop from the same period in 2024, CNBC reported yesterday, citing data from ArtTactic.

• Postwar and contemporary art sales, which had previously been a growth driver, slumped by an even steeper 19%.
• Because auction sales also declined over the past two years, the total is now down 44% from 2022, a dip of more than $3 billion.
• It might signal a significant shift in where the richest among us are parking their cash. The Wall Street Journal notes that UBS found the ultrarich put 15% of their wealth into art last year compared to 24% in 2022.

What’s unusual is that this is happening as the S&P 500 keeps ripping and the wealth of the wealthiest is growing, since art is generally considered a sound investment and a good hedge against inflation. It’s the first time the fates of the art market and the stock market have diverged in more than 200 years, Yale professor William Goetzmann told the WSJ, based on his analysis of some presumably really dusty auction records.—AR