Highlights
Intel warns of risks. In a SEC filing, Intel reported that the US governments 10% stake in the company poses risks to the business, citing that international sales could suffer, risk of litigation is higher, other foreign governments may request stakes in turn, and the deal will reduce the voting power of other shareholders. There is both praise and pushback from both sides of the aisle.
Commerce voids NSTC. US Commerce Dept has voided a US$7.4 billion commitment to the public-private semiconductor research consortium, the National Semiconductor Technology Center (NSTC), which was established under the CHIPS Act. Instead the operations of the group will now be under the National Institute of Standards and Technology (NIST), which sits under Commerce. It’s unclear what exactly this means, but is nonetheless a sign of the Commerce Dept consolidating power. It’s also another indicator of how the CHIPS Act is changing under the Trump administration, as had been alluded to at least since Lutnick’s confirmation hearing.
Huawei towards AI. Two pieces of Huawei news. Huawei restructures its cloud computing unit to put a focus on AI. Huawei is also expanding into the memory semiconductor space, unveiling a new AI SSD for the first time. Memory is getting crowded.
Thanks for reading.
1. Policy and Geopolitics
1.1
WaPo (08/26): Intel says Trump’s plan for U.S. stake in company poses business risks
Intel warned Monday that the Trump administration’s 10 percent stake in the chipmaker presents risks to its business, potentially jeopardizing sales and its standing with stakeholders, as the White House signaled it may pursue similar tie-ups with other companies.
In a Securities and Exchange Commission filing, the company said international sales could suffer as a result of the agreement President Donald Trump announced Friday that turned the federal government into its largest shareholder. Intel also said it could face litigation and possible backlash from foreign governments, business partners and even its own employees over the deal.
The chipmaker also disclosed Monday that the federal government’s share could go as high as 15 percent if it does not meet certain manufacturing thresholds. The deal’s structure raises the possibility that other government entities might demand stakes, the SEC filing said, and that the federal government’s objectives might diverge from those of its other shareholders. “This will reduce the voting influence of other stockholders,” Intel said.
Sen. Rand Paul (R-Kentucky) called it a “terrible idea,” and California Gov. Gavin Newsom (D) said that under Trump, the U.S. is now “the socialist republic of America.” Intel is headquartered in Santa Clara, California.
1.2
Reuters (08/25): White House's Hassett says US could take stakes in other chip companies
The federal government could take stakes in other U.S. semiconductor companies or even move to other industries, White House economic adviser Kevin Hassett told CNBC in an interview on Monday following its stake in Intel.
Hassett, asked if the Intel deal was the start of a larger effort by the U.S. government to take equity stakes in other industries that it subsidizes, or other companies in the AI and chip space that are subsidized such as Advanced Micro Devices Inc or Taiwan Semiconductor Manufacturing Co, said there could be other similar transactions.
1.3
Reuters (08/26): US Commerce voids Biden's $7.4 billion semiconductor research grant deal
The U.S. Commerce Department said on Monday that one of its agencies will take over operational responsibility to oversee $7.4 billion in semiconductor research funds, saying that the private non-profit established under the Biden administration to handle that function "served as a semiconductor slush fund."
The National Institute of Standards and Technology will assume operational responsibility for the National Semiconductor Technology Center, a public-private consortium established under Democratic President Joe Biden, from the National Center for the Advancement of Semiconductor Technology (Natcast).
The department said the Biden administration illegally created Natcast, and as a result the agreement granting the organization up to $7.4 billion in taxpayer money is invalid.
1.4
Bloomberg (08/26): Saudi’s Humain to Open Data Centers With US Chips in Early 2026
Saudi Arabia’s new artificial intelligence company, Humain, has broken ground on its first data centers in the kingdom and plans to have them up and running in early 2026 with the use of semiconductors imported from the US.
Locations in the capital of Riyadh and the Eastern Province’s Dammam are expected to launch in the second quarter, with an initial capacity of as much as 100 megawatts each, according to Chief Executive Officer Tareq Amin.
Humain is in the process of procuring semiconductors for those data centers from US chipmakers, including Nvidia Corp., Amin said. The Saudi company has received local regulatory approval to purchase 18,000 of Nvidia’s latest AI chips, he added.
1.5
Bloomberg (08/25): Malaysia Unveils First AI Device Chip to Join Global Race
Malaysia unveiled its own AI processor Monday, joining a global race to build the most sought-after electronic components for artificial intelligence development.
Local designer SkyeChip introduced the MARS1000 at an industry association event attended by senior government officials. The chip is the country’s first edge AI processor, meaning a component that powers devices from cars to robots from within, the Malaysia Semiconductor Industry Association said in a statement.
1.6
Nikkei (08/26): Japan to invest $68bn in India over 10 years, including AI and chips
Japanese Prime Minister Shigeru Ishiba will unveil plans for investing 10 trillion yen ($68 billion) to deepen bilateral business ties with India over the next 10 years during his summit with Indian counterpart Narendra Modi beginning Friday.
2. Economy, Finance, and Business
2.1
SCMP (08/25): Huawei revamps cloud computing unit to prioritise AI amid China-US tech war
Huawei Technologies has begun a major restructuring of its cloud computing unit as the Chinese tech giant sharpens its focus on artificial intelligence amid the Sino-US tech war, according to sources and Chinese media reports.
The subsidiary – responsible for AI model development, cloud services and data centre solutions – kicked off the restructuring on Friday, merging several key departments to prioritise AI-related business, according to two employees involved, who requested anonymity because the information was private.
It remains unclear how many employees will be affected by the changes as many may have the opportunity to transfer internally, one source said.
2.2
Bloomberg (08/26): Japan’s Niche Chip Gear Makers Left Out of Nvidia Boom, CEO Says
Prices are rising across Japan, but not for the components of chipmaking gear. Tokyo Electron Ltd. supplier Marumae Co. is seeking out deals to change that.
Many Japanese makers of vacuum parts found in chip tools have yet to reap gains from an AI boom that’s spurring billions of dollars of spending on Nvidia Corp. chips and other hardware, according to Marumae President Toshikazu Maeda. That’s because such manufacturers are fighting with dozens of other companies in Japan that specialize in creating air-tight spaces inside bigger machines — a niche but essential area worth less than ¥100 billion ($680 million) in domestic sales.
The country’s chip tool components sector is long overdue for consolidation, said Maeda, who spearheaded the acquisition of peer KM Aluminum Co. for ¥9 billion from private equity fund Japan Industrial Partners Inc. in March. Beyond that deal, talks have dried up, although there’s urgent need for scale in the sector, he said in an interview.
2.3
SCMP (08/25): China’s server, chipmakers enter ‘super cycle’ as AI computing capacity mushrooms
China’s domestic server and chipmakers are entering a “super cycle” as the country’s local governments spend lavishly on computing infrastructure to support artificial intelligence development.
The AI Computing Power Concept Index, compiled by Chinese financial data provider Wind and comprising 54 component stocks, hit a record high on Monday, with an increase of 166 per cent over the past 52 weeks.
The frenzy was stoked by DeepSeek’s hint last week that it has changed its data format to support domestic AI chips.
3. Technology
3.1
TrendForce (08/26): Huawei Enters Global AI Memory Race with Upcoming AI SSD on August 27
Shortly after releasing UCM (Unified Computing Memory)—an AI inference acceleration toolkit designed to reduce China’s HBM reliance—Huawei is making waves again in the memory sector as it plans to unveil a new AI SSD on August 27, according to Chinese media outlets guancha.cn and National Business Daily.
As the report from National Business Daily notes, this move shows Huawei is stepping into the global AI memory race with its latest AI SSD, joining memory giants like Kioxia and Micron. While Kioxia has laid out a mid-to-long-term plan centered on AI-driven storage innovation, SSD expansion, and capital efficiency to strengthen its NAND market position, Micron recently rolled out three AI SSDs, with the Micron 7600 SSD targeting AI inference and mixed workloads, the report adds.
3.2
TrendForce (08/26): NVIDIA Reportedly Plans 2027 HBM Logic Die Design to Gain Supply Chain Leverage Over TSMC, SK hynix
NVIDIA is working to reinforce its position in the HBM value chain by taking on the design of the “logic die,” a core component of HBM, starting in the second half of 2027, while also planning to diversify where it sources them.
As the report highlights, industry sources see NVIDIA’s strategy as an effort to rebalance its relationship with critical partners like TSMC and SK hynix, curb their negotiating leverage, and keep supply costs in check.
The report underscores that SK hynix and other memory manufacturers have so far produced logic dies internally. However, the next generation, HBM4 — entering mass production in the second half of this year — is driving a transition to foundry-based production. SK hynix has tapped TSMC for this role, and industry sources believe Micron is poised to do the same, the report notes.
3.3
TrendForce (08/25): TSMC Reportedly Eliminates Chinese Equipment Use in 2nm Production as U.S. Rules Loom
TSMC is removing Chinese chipmaking equipment from its leading-edge 2nm fabs to guard against potential U.S. restrictions that could disrupt production. As the report notes, sources said the decision was influenced by the prospect of a U.S. regulation that would bar chipmakers receiving American funding from using Chinese manufacturing tools.
The report adds that U.S. lawmakers, led by Sen. Mark Kelly, have proposed the Chip EQUIP Act, which would prohibit recipients of federal subsidies and tax credits from purchasing equipment from “foreign entities of concern,” a label the industry understands to include Chinese suppliers.
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