The returning Trump administration will embody its “America First” and “Made in America” stances more than ever in 2025. President Trump stated It will impose customs duties on imports of up to 25%. Especially with customs duties imposed on Chinese goods of up to 60%. Trump also insists on American independence in the semiconductor industry within the computer and technology sector. Trump has stated his belief that Taiwan has done so stolen away Chip industry in America.
President Trump has been a critic of the CHIPS Act and the Inflation Reduction Act. Vivek Ramaswamy, co-head of the government’s efficiency ministry, also criticized policies and plans to scrutinize wasteful subsidies. Here are two important semiconductor companies in the computer and technology sector that are at risk of further trade restrictions and impacts from the Trump administration.
Semi-Taiwan: Making the AI Revolution Possible in the United States
Taiwan Semiconductor Manufacturing Co., Ltd New York Stock Exchange: TSM Not only does it manufacture the majority of chips for major US semiconductor companies, e.g Apple Inc Nasdaq: Apple and Qualcomm company Nasdaq: Qcombut it also has a virtual monopoly on artificial intelligence (AI) chips including GPUs and application-specific integrated circuits (ASICs). The AI boom has only been possible because Taiwan Semi produces AI chips Nvidia company Nasdaq: NVDA, Applied Micro Devices Company Nasdaq: AMD, Broadcom Company Nasdaq:AFGOand Marvell Technology Company Nasdaq: MRFL. This makes Taiwan a major trading partner of the United States.
If Trump imposes 10% tariffs on chips made in Taiwan, the AI boom will be even more expensive to continue. However, the head of Taiwan’s central bank There are doubts that it will happen. Taiwan Semi collects the majority of its revenue from the United States, about 65%, and about 10% to 12% of its revenue from China. Top broadband companies like Google, Amazon, Microsoft Corporation Nasdaq: MSFT They are in the process of making their own AI chips based on Taiwan Semi, usually through Broadcom or Marvell technology. until Tesla company Nasdaq: Tesla It depends on Taiwan for its chips.
The threat of a Chinese invasion of Taiwan by 2027
Since Taiwan produces 90% of the world’s most advanced computer chips, Chinese control over Taiwan poses a major global threat. Chinese President Xi Jinping has publicly stated that he wants to return Taiwan to Chinese control. Beijing believes Taiwan is part of its territory, while Taiwan says it is not. China has intensified its military activities around Taiwan. On February 2, 2024, CIA Director William Burns male Xi has already ordered his military to prepare to invade Taiwan by 2027. However, analysts doubt that this will bear fruit, especially during Trump’s second term.
Eliminate $7 billion for Taiwan from the CHIPS Act
Taiwan Semi is building a foundry in Arizona and is supposed to receive $7 billion under the CHIPS Act. Trump has expressed his opposition to giving money to foreign companies to build factories in the United States. He doesn’t think they’ll make advanced chips here anyway. Taiwan Semi has not yet received the money, and the threat of it being canceled or paused if Trump’s inauguration does not lead to its distribution is high. Naturally, Trump would favor domestic semiconductor companies that build foundries in the United States, e.g Intel Corporation NASDAQ:INTEC, Texas Instruments Corporation Nasdaq: TXNand International Factories Company Nasdaq: GFS.
ASML: More potential fallout from Chinese trade restrictions
To produce computer chips, you need photolithography machines to manufacture them. ASML Holdings NV Nasdaq: ASML Machines produce extreme ultraviolet (EUV) photolithography needed to make central processing units (CPUs), graphics processing units (GPUs) and ASICs. While the Netherlands-based company sells deep ultraviolet (DUV) machines to China, it has never sold more advanced UV machines due to restrictions imposed by the Dutch government. The Dutch government is allied with the United States in its belief that China poses a threat. Its Foreign Ministry says: “The Netherlands shares US concerns about the uncontrolled export of advanced semiconductor equipment.”
US imposed a Third crackdown In three years, semiconductor equipment and export regulations have tightened To 140 Chinese companies. ASML said it would be affected by restrictions on sales of DUV lithography machines to China but expects long-term impacts to be minimal. ASML expects to generate 20% of its sales from China, but this amount has decreased from 50% in 2024.
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