Semiconductor Industry News

Last week, China barred its major tech companies from buying Nvidia chips. This move received only modest attention in the media, but has implications beyond what’s widely appreciated. Specifically, it signals that China has progressed sufficiently in semiconductors to break away from dependence on advanced chips designed in the U.S., the vast majority of which are manufactured in Taiwan. It also highlights the U.S. vulnerability to possible disruptions in Taiwan at a moment when China is becoming less vulnerable. After the U.S. started restricting AI chip sales to China, China dramatically ramped up its semiconductor research and investment to move toward self-sufficiency. These efforts are starting to bear fruit, and China’s willingness to cut off Nvidia is a strong sign of its faith in its domestic capabilities. For example, the new DeepSeek-R1-Safe model was trained on 1000 Huawei Ascend chips. While individual Ascend chips are significantly less powerful than individual Nvidia or AMD chips, Huawei’s system-level design to orchestrate how a much larger number of chips work together seems to be paying off. For example, Huawei’s CloudMatrix 384 system of 384 chips aims to compete with Nvidia’s GB200, which uses 72 higher-capability chips. Today, U.S. access to advanced semiconductors is heavily dependent on Taiwan’s TSMC, which manufactures the vast majority of advanced chips. Unfortunately, U.S. efforts to ramp up domestic semiconductor manufacturing have been slow. I am encouraged that one fab at the TSMC Arizona facility is operating, but issues of workforce training, culture, licensing and permitting, and the supply chain are still being addressed, and there is still a long road ahead for the U.S. facility to be a viable substitute for Taiwan manufacturing. If China gains independence from Taiwan manufacturing significantly faster than the U.S., this would leave the U.S. much more vulnerable to possible disruptions in Taiwan, whether through natural disasters or man-made events. If manufacturing in Taiwan is disrupted for any reason and Chinese companies end up accounting for a large fraction of global semiconductor manufacturing capabilities, that would also help China gain tremendous geopolitical influence. Despite occasional moments of heightened tensions and large-scale military exercises, Taiwan has been mostly peaceful since the 1960s. This peace has helped the people of Taiwan to prosper and allowed AI to make tremendous advances, built on top of chips made by TSMC. I hope we will find a path to maintaining peace for many decades more. But hope is not a plan. In addition to working to ensure peace, practical work lies ahead to multi-source, build more fabs in more nations, and enhance the resilience of the semiconductor supply chain. Dependence on any single manufacturer invites shortages, price spikes, and stalled innovation the moment something goes sideways. [Original text: https://lnkd.in/gxR48TK8 ]

AI holds great potential for the semiconductor industry and will kick-start the next round of innovation for faster, cheaper and more energy-efficient computation – that was my message today at SPIE Advanced Lithography + Patterning. I discussed the potential and the challenges that AI holds for our industry.   The potential is clearly huge. AI is rapidly integrated into applications, and high-performance compute is expected to underpin growth towards $1 trillion of semiconductor sales by 2030. The challenges are around the computing needs of AI models and related energy consumption. The compute workload of training a leading AI model has increased 16x every 2 years in recent years – much faster than the increase in computing power delivered by Moore’s law, which is about 2x every 2 years. The energy needed to train a leading model has not grown so steeply but still rose 10x every 2 years. This computing need has been met by building supercomputers and massive data centers. If you extrapolate these trends, training a leading AI model would need the entire world-wide electricity supply in about 10 years. That’s clearly not realistic, so the trend has to break, by training algorithms becoming more efficient and by chips becoming more efficient. In other words, the needs of AI will stimulate immense innovation in chip design and manufacturing – and the potential value of AI to our society will put urgency and funding behind that drive. As a consequence, chip makers are pulling all levers to accelerate semiconductor scaling. This includes lithographic “2D” scaling: shrinking the dimensions of transistors to pack more into a square millimeter. It will also include “3D” integration, with innovations like backside power delivery, transistor designs like gate-all-around, as well as stacking chips in the package, where holistic lithography will play a critical role to deliver performance requirements. ASML will support these trends through a comprehensive, holistic lithography portfolio. Our 0.33 NA/0.55 NA EUV lithography systems allow chip makers to shrink dimensions at the lowest possible cost on their critical layers, while tightly matched and highly productive DUV systems will continue to reduce cost. More than ever, metrology and inspections tools – whose data is fed into lithography control solutions that keep the patterning process operating within tight specs to deliver the highest possible production yields – will be essential to deliver 2D scaling and 3D integration processes. 3D integration requires wafer-to-wafer bonding, and we have demonstrated the capability to map the stresses and distortions that bonding creates and to compensate for them, reducing overlay errors for post-bonding patterning by 10x or more.   It was a pleasure catching up with the industry’s lithography and patterning experts in San Jose. I’m excited to see our collective innovation power having a go at these challenges. Together, we will push technology forward.

Rebuilding U.S. manufacturing has quietly begun, and the scale may surprise you. For decades, the U.S. offshored semiconductor and electronics manufacturing to Asia. Over time, China absorbed a large share of that capability. What we face today isn’t theoretical — it’s an economic and national security risk. Reversing that dependency is extraordinarily difficult. We didn’t just move factories overseas. We lost skills, supplier depth, process knowledge, and an entire manufacturing ecosystem. Rebuilding that capability in the U.S. means recreating decades of industrial expertise at speed. This effort began accelerating in 2022 with the CHIPS and Science Act and has compounded rapidly. Based on announced commitments from 2022–2026, semiconductor and electronics investments now total ~$1.7 trillion. ⸻ Who is rebuilding America’s semiconductor & electronics ecosystem Foundry & leading-edge logic (the fabs) 🔹 TSMC: $165B | 2nm–4nm logic, Arizona six-fab cluster 🔹 Intel: $100B+ | U.S. foundry strategy (Ohio + Arizona) 🔹 Samsung Electronics: $45B | Advanced logic & packaging, Texas Memory & AI compute 🔹 Micron Technology: $200B | DRAM & HBM hubs (Idaho, New York) 🔹 SK Hynix: $14B | Advanced AI-memory packaging, Indiana U.S. electronics & silicon anchor customers 🔹 Apple: $600B | U.S. silicon, AI servers, advanced packaging 🔹 Foxconn: $2B+ | AI-server manufacturing for U.S. cloud providers Foundational chips (automotive, industrial, defense) 🔹 Texas Instruments: $60B | Analog & embedded chips 🔹 GlobalFoundries: $12.5B | Secure, automotive, aerospace semiconductors Advanced packaging & integration 🔹 Amkor Technology, Inc.: $2B+ | U.S. back-end packaging, Arizona 🔹 Absolics: $600M+ | Glass substrates for next-gen AI chips Equipment, lithography & process control 🔹 Applied Materials: $4B+ | Process tools & R&D 🔹 ASML: $1B+ | High-NA EUV support (U.S. expansion) 🔹 Lam Research / KLA: $2B+ | Etch, deposition, yield control Materials, wafers & chemicals 🔹 GlobalWafers: $5B | 300mm wafers, Texas 🔹 Fujifilm / Entegris: $1.5B+ | Photoresists & ultra-pure chemicals 🔹 USA Rare Earth: $1.6B | Mine-to-magnet electronics materials Infrastructure that makes fabs possible 🔹 Linde / Air Liquide: $1B+ | Ultra-pure gases piped directly into fabs Geopolitical capital 🔹 Taiwan: $500B total ($250B in direct industrial investment to build fabs, packaging, materials, and suppliers in the U.S. Plus $250B in government-backed incentives to de-risk, accelerate, and anchor those projects long term) ⸻ What we need: 1. Revamp education to produce the ~88,000 engineers and technicians required to staff these future facilities. 2. Continue advancing automation and robotics to reduce labor intensity while increasing reliability and yield. 3. Build strong supply chains with allies for the components we can’t (or shouldn’t) manufacture domestically. #manufacturing #semiconductors #robotics #electronics

“In recent decades, only a handful of government interventions have been widely regarded as successes. Operation Warp Speed is one of them. So is the CHIPS Act, the $39 billion program that catalyzed a massive investment boom in manufacturing semiconductors on American soil… …In the years between 2007 and 2020, annual domestic construction spending in computers, electronics, and electrical manufacturing averaged $3.3 billion. After the program was authorized in 2020, and in the nearly five years since, it’s averaged $71.8 billion per year. That’s nearly twenty times higher.” https://lnkd.in/examw8ju

5 biggest bottlenecks India faces in building a complete semiconductor manufacturing ecosystem 1. Lack of Proven, Large-Scale Manufacturing Experience (Fabs & OSAT) 🚀 India is strong in chip design and verification, but has almost no history of running high-volume semiconductor fabs. 🚀 Semiconductor manufacturing is not just capex-intensive—it is process- and yield-experience driven, built over decades. 🚀 Global customers hesitate to commit volumes without proven yield, reliability, and execution track records. Impact: Delays in ramp-up, lower yields, and difficulty attracting anchor customers. 2. Weak Domestic Semiconductor Supply Chain (Materials, Chemicals, Equipment) 🚀 India lacks local suppliers for: - Ultra-pure gases and chemicals - Silicon wafers - Photoresists and specialty materials - Semiconductor-grade equipment and spare parts - Heavy reliance on imports increases cost, lead times, and geopolitical risk. Impact: - Higher operational risk and reduced competitiveness versus Taiwan/Korea/China. 3. Talent Gap in Manufacturing & Process Engineering 🚀 India produces many VLSI designers, but very few fab-level process engineers, equipment engineers, and yield specialists. Skills required for: - Lithography - Etch / deposition - CMP - Advanced packagingare scarce domestically. Impact: Dependence on expatriates, slow learning curves, and higher operational risk. 4. Infrastructure Constraints (Power, Water, Logistics) 🚀 Semiconductor fabs require: - Uninterrupted power with extremely low voltage fluctuation - Millions of liters of ultra-pure water daily - World-class waste treatment and cleanroom infrastructure Many Indian industrial zones still lack fab-grade utilities and logistics reliability. Impact: Higher capex, longer setup times, and operational uncertainty. 5. Long-Term Policy Certainty & Speed of Execution Semiconductor investments need 20–30 year policy stability, fast clearances, and predictable incentives. India still struggles with: Lengthy approval processes Inter-state policy variations Slow execution of announced projects 🚀 Impact: Investor hesitation and comparison losses against faster-moving countries. India’s challenge is not intent or funding, but execution depth, ecosystem maturity, and manufacturing credibility. The ecosystem must be built end-to-end and in parallel, not in silos. As they say, each bottleneck is an opportunity and India understands this & is solving all of these right now. ~~~~ If you are looking to invest in semiconductors and need expert insights, drop us a DM.

China’s export restrictions rattle global markets… In 2023, China imposed export controls on critical #semiconductor materials germanium and gallium, as well as controls of graphite and technologies used in rare earth extraction and separation, shaking global markets. The materials are vital for advanced microprocessors and military optical hardware. Last month, export restrictions on antimony followed – a mineral used in armor-piercing ammunition, night-vision goggles, and precision optics. In retaliation for the US-led restrictions on the supply of high-tech chip making equipment to China, the impact of these controls has been profound, with prices of germanium and gallium nearly doubling in Europe. China's dominance in the global supply of these materials is formidable, producing 98% of the world's gallium and 68% of germanium. Since the controls, the availability of these materials outside China has plummeted – gallium exports have dropped by half. It has added complexity to already challenging markets and a wide range of #hardware from fiber-optic products to night-vision goggles could be next in the firing line. Long-term supply contracts are now impossible to obtain and shipment approval can take between 30 to 80 days. The situation has been exacerbated by accusations of Chinese stockpiling, which traders blame for the 52% surge in germanium prices since June. US companies are grappling with the challenges of obtaining export licenses and facing a limited stock of germanium and gallium, and the risk of running out is high. Efforts are underway to increase local production and find substitutes for these critical minerals. In some applications, gallium can be substituted with silicon or indium, while zinc selenide can replace germanium in certain uses. Additionally, recycling initiatives are being considered to recover these metals from scrap, but this is limited. However, these alternatives come at a significant cost, with estimates for developing a separate supply chain for processing gallium and germanium for the US and its allies costing US$20 billion and spanning several years… Daily #electronics from Asia insights – follow me, Keesjan, and never miss a post by ringing my 🔔. #technology #innovation

Global chip sales neared $800 billion in 2025 and are on track to cross the $1 trillion threshold in 2026, according to recent Semiconductor Industry Association data. That's four years ahead of earlier projections. 🔥 And just last month, McKinsey & Company published their base-case market scenario at a whopping $1.6 trillion by 2030. Wow. 🤯 What's driving this acceleration? Two segments are powering virtually all of the growth: 🧠 Advanced Logic chips (AI accelerators and GPUs at the heart of data center buildouts) grew nearly 40% year-on-year in 2025. This is the largest market segment and the backbone of AI infrastructure expansion. 💾 Advanced Memory chips (high-bandwidth memory and DRAM essential to AI workloads) surged almost 35% last year, keeping pace with the voracious appetite of modern AI systems. Together, these two categories account for the vast majority of the industry's explosive 2025 performance. With both chip volume and chip prices on the rise, this dynamic amplifies revenue growth further. And given the semiconductor industry's winner-take-all dynamics, a handful of highly innovative players will capture the lion's share of profits. Meanwhile, companies in mature chip segments face a different reality. They're locked in a relentless battle on cost, scaling up operations or driving operational efficiencies just to stay competitive. Their strategic playbook: squeeze every basis point out of costs while simultaneously trying to climb into higher-growth segments and differentiate products that are increasingly commoditized. So what's next on the market's road to $1 trillion? According to SIA President John Neuffer, trends like AI and autonomous driving will sustain demand well beyond this cycle. But with supply chains tightening, component prices rising, and geopolitical tensions reshaping where and how chips are made, the road to $1 trillion may be as layered and complex as the semiconductors themselves. 💭 Sources: SIA: https://lnkd.in/eyyuBFMe McKinsey: https://lnkd.in/eirS9idW // 📫 Join the Curious Clan! Subscribe for free to my weekly newsletter Always Be Curious. The link's up there, just under my name. 🔗 You’ll get the now, how and wow of science and tech, with a special focus on the chip industry. Every Sunday morning. ☕️🥐

China’s Chip Strategy Is Evolving—Faster Than Expected As someone who serves on the boards of two public semiconductor companies, I found @Liza Lin’s WSJ piece to be clear, rational, and timely. It’s a valuable watch for anyone tracking the future of global semiconductor supply chains and its impact on AI. U.S. export controls aimed at slowing China’s chip development have had a complex impact. One unintended consequence: a renewed push for self-sufficiency. SMIC, despite restrictions, is now producing 7nm chips—technology that powers Huawei’s latest smartphone and was once thought inaccessible without Western semiconductor manufacturing equipment. Beyond the technical achievement, China is investing billions in its semiconductor ecosystem—from equipment and fabrication to talent pipelines. Local firms are shifting procurement strategies, reinforcing domestic capacity. This is more than just a semiconductor story. It cuts across global supply chains, national security, and AI development. A critical inflection point—worth watching closely. https://lnkd.in/gfhvpytF #Semiconductors #AIstrategy #TechSupplyChain #BoardLeadership

Our “250 years of US innovation” series continues with the latest edition, “Chips ahoy,” exploring the foundational discoveries and government support that shaped the US semiconductor industry. While the mythology of Silicon Valley’s rise often starts in a garage, the real story began with breakthroughs across the country—from Bell Labs in New Jersey to Texas Instruments in Dallas, where the first commercially viable silicon-based transistor was developed, paving the way for the microchip era. On the Pacific Coast, Fairchild Semiconductor produced the first integrated circuit, and Intel was born soon after. Federal policy and financial support were crucial, especially for defense and aerospace, echoing the role government played in building the transcontinental railroad and commercial aviation. After setbacks in the 1980s, the US government renewed its commitment to semiconductor production, most recently with the CHIPS for America Act. Today, international competition in the AI arms race, supply chain challenges, and access to critical minerals are driving policy decisions and investment. The AI race is spurring new spending on semiconductor research, manufacturing, and design. The US remains at the cutting edge of chip design, but manufacturing capabilities still lag. Nearly 70 years after the first discoveries, the future of semiconductors is bright—but there is no room for complacency. Thank you to my colleagues Kurt Reiman and Delwin Limas, CFA for their work on this insightful report. 

Interesting News in the Semiconductor Industry! The Biden administration announced a groundbreaking investment in Intel, awarding the tech giant nearly $20 billion in grants and loans. This strategic move is set to supercharge the domestic production of semiconductor chips, marking the government's largest effort yet to subsidize advanced chip manufacturing. 🏗️ Intel's plans include the construction of two new factories and the modernization of an existing facility in Arizona, an initiative that promises to significantly bolster the U.S. semiconductor industry. This investment is a pivotal component of the 2022 CHIPS and Science Act, which aims to rejuvenate U.S. semiconductor production with $52.7 billion in funding. 🇺🇸 Commerce Department Secretary Gina Raimondo highlighted this as "one of the largest investments ever in the U.S. semiconductor manufacturing," aiming to escalate the United States' share of leading-edge chip production from 0% to 20% by 2030. 💡 This historic outlay underscores the administration's commitment to reducing reliance on foreign chip production and enhancing national security. It also positions the U.S. to regain its stature as a global leader in technology and innovation. 🗳️ Beyond its economic and strategic significance, this investment carries substantial political weight, especially considering Arizona's pivotal role in recent and upcoming elections. It signals a broader effort to bring manufacturing back to America and secure the U.S.'s competitive edge in critical technologies. Let's discuss: How will this investment shape the future of the semiconductor industry and U.S. technological leadership? What impacts can we expect on the job market and economic growth in the regions receiving these investments? How can other tech companies and startups leverage this momentum in semiconductor manufacturing? #SemiconductorIndustry #Innovation #SustainabilityInTech #Geopolitics #CHIPSAct https://lnkd.in/dJaMe-8Y