Reported 4 months ago
Taiwan Semiconductor Manufacturing Co. (NYSE: TSM) plays a crucial role as Chinese AI chip firms design less powerful processors to comply with U.S. sanctions, affecting companies like Nvidia Corp. (NASDAQ: NVDA). With the U.S. imposing export controls on advanced processors and manufacturing equipment to hinder China’s military AI advancements, TSMC is looking to boost prices, given its key role in the industry. Washington’s sanctions have highlighted China’s dependency on TSMC for advanced chips, leading to downgraded chip designs by Chinese firms like MetaX and Enflame. Despite China's investments in chip self-sufficiency, SMIC struggles with limited capacity and reserved production for Huawei, while vendors turn to an underground market for Nvidia chips. TSMC's stock has gained 56% in the last 12 months, with investors exploring exposure through ProShares Ultra Semiconductors (NYSE: USD) and Invesco PHLX Semiconductor ETF (NASDAQ: SOXQ).
Source: YAHOO