Daily: US may revoke chip waivers; $1 trillion AI/robotics complex?; Korea's largest data centre
5.5 min read.
Highlights
US may revoke chip waivers. Washington may revoke waivers that allow Samsung, SK Hynix, and TSMC to import American technology into their factories in China, which bypass the current restrictions. Samsung has 3 fabs and a research centre, while SK Hynix has 4 fabs, while TSMC has 2.
Semiconductor stocks slide across the board, with the Philadelphia Semiconductor Index falling 2%.
I’m not sure what the motives are behind the move. I get that the United States wants to prevent Chinese companies from advancing AI and chip capabilities, and the current export controls are not watertight. I’m not sure how much of the leakage is coming from Korean and Taiwanese firms operating plants inside the mainland, most of which are memory chip plants and not advanced logic manufacturing that you need for AI. Instead, most of the leakage seems to come from direct smuggling and workarounds, like data centres in Malaysia or Huawei’s shell company Sophgo contracting from TSMC.
$1 trillion AI/robotics complex? The eccentric SoftBank founder Masayoshi Son reportedly proposed a US$1 trillion idea to Commerce Secretary Howard Lutnick. Son wants to build a massive AI and robotics complex in Arizona, in collaboration with TSMC. Son is (in)famous for making big-numbered, high-profile bets, many of which never come to fruition as promised.
Korea’s largest data centre. SK Hynix’s parent company SK Group and Amazon Web Services (AWS) will collaborate to build South Korea’s largest data centre. The data centre, which is a US$5 billion investment, will be operational with a 100 megawatt capacity by 2029, which would make it roughly on par with today’s top 10 largest data centres in the world.
Thanks for reading.
1. Policy and Geopolitics
1.1
WSJ (06/20): U.S. Prepares Action Targeting Allies’ Chip Plants in China
A U.S. official told top global semiconductor makers he wanted to revoke waivers they have used to access American technology in China, people familiar with the matter said, a move that could inflame trade tensions.
Currently, South Korea’s Samsung Electronics and SK Hynix as well as Taiwan Semiconductor Manufacturing enjoy blanket waivers that allow them to ship American chip-making equipment to their factories in China without applying for a separate license each time.
Jeffrey Kessler, head of the Commerce Department unit in charge of export controls, told the three companies this week he wanted to cancel those waivers, according to people familiar with the meetings. They said Kessler described the action as part of the Trump administration’s crackdown on critical U.S. technology going to China.
1.2
Bloomberg (06/21): Chip Stocks Slide on Report of New Possible Limits on China
Shares of Taiwan Semiconductor Manufacturing Co. and other chipmakers slid on Friday after the Wall Street Journal reported that the Trump administration is considering further restrictions on China.
The Philadelphia Stock Exchange Semiconductor Index, a closely watched benchmark, fell as much as 2% after the report was published.
The US depositary receipts of TSMC, the world’s largest contract manufacturer of chips, dropped as much as 2.5%. Shares of chip equipment makers also fell, with Applied Materials Inc. declining as much as 4%. The Netherlands’ ASML Holding NV slid as much as 1.9%.
1.3
Reuters (06/22): South Korea to raise concerns to US over potential curbs on chipmakers' China operations
South Korea's top trade negotiator said on Sunday he would raise concerns about potential U.S. restrictions on chipmakers in China when he meets U.S. officials in Washington this week for the third round of technical discussions in tariff talks.
1.4
SCMP (06/20): China’s top player Empyrean eyes opportunities from US chip curbs on design software
Chinese chip-design software company Empyrean Technology has pledged to become one of the world’s top electronic design automation (EDA) providers, as new US export restrictions bring both opportunities and challenges to the domestic industry.
Founded in 2009 and based in Beijing, Empyrean aims to ascend to the top tier of EDA providers, capitalising on the struggles faced by its US competitors in selling to China because of new export controls on chip-design software, said Yu Han, a senior market director at Empyrean, at the World Semiconductor Conference in Nanjing, capital of eastern Jiangsu province, on Friday.
2. Economy, Finance, and Business
2.1
FT (06/21): SoftBank chief pitches $1tn AI and robotics complex in Arizona
SoftBank founder Masayoshi Son is pushing the idea of a vast $1tn artificial intelligence and robotics complex in the US state of Arizona that could include the establishment of a free-trade zone and the involvement of the world’s biggest chipmaker, TSMC.
The plan, which Son has raised with US commerce secretary Howard Lutnick, is aimed at bringing high-tech manufacturing into the country at scale, said three people familiar with the concept, which was first reported by Bloomberg.
2.2
Reuters (06/20): South Korea says SK and Amazon to invest $5 billion in country's biggest data centre
South Korea's SK Group will invest around 7 trillion won ($5.11 billion) including $4 billion from Amazon Web Services, Amazon's cloud services provider, to build a data centre in the southern city of Ulsan, the Science Ministry said on Friday.
The AI data centre, which will be the country's largest, will break ground in September and be fully operational with a capacity of 100 megawatts by 2029, the ministry said in a statement.
2.3
TrendForce (06/20): UMC Reportedly Eyes Southern Taiwan Facility for Advanced Packaging Expansion Beyond Singapore
Taiwan’s second-largest foundry, UMC, is stepping up its efforts in advanced packaging. According to a report from Commercial Times, sources say the company is considering acquiring the facility of TFT-LCD panel maker HannStar in the Southern Taiwan Science Park, which could be used to develop future advanced packaging capacity.
While UMC declines to comment on the rumor, it states that it has already established 2.5D advanced packaging capacity in Singapore and has moved part of its process back to Taiwan. The company adds that further expansion in Taiwan remains a possibility, the report highlights.
UMC currently operates its Fab 12A facility in the Southern Taiwan Science Park, which began volume production in 2002. The fab now supports 14nm processes, as noted by the report.
3. Technology
3.1
Reuters (06/20): Nvidia, Foxconn in talks to deploy humanoid robots at Houston AI server making plant
Taiwan's Foxconn and U.S. artificial intelligence chips maker Nvidia are in talks to deploy humanoid robots at a new Foxconn factory in Houston that will produce Nvidia AI servers, two sources familiar with the matter said.
This would be the first time that an Nvidia product will be made with the assistance of humanoid robots and would be Foxconn's first AI server factory to use them on a production line, the sources said.
A deployment, expected to be finalised in the coming months, would mark a milestone in the adoption of the human-like robots that promises to transform manufacturing processes.
3.2
TrendForce (06/23): ASML’s High-NA EUV May Play a Smaller Role in Future Chipmaking, Intel Director Reportedly Claims
According to a report from Wccftech, an unnamed Intel director states on the investment research platform Tegus, then shared by Tech Fund on X, that future high-end chip manufacturing will rely less on advanced lithography tools and more on etching technology. As indicated by the report, the director explains that emerging transistor architectures—such as gate-all-around FET (GAAFET) and complementary FET (CFET)—could significantly reduce reliance on lithography in the chipmaking process.
The report points out that although lithography machines—like ASML’s advanced EUV and high-NA EUV scanners—often dominate discussions due to export controls, chip manufacturing also relies on other key processes, such as deposition and etching. Lithography serves as the initial step, transferring circuit designs onto the wafer, which are then cemented through subsequent deposition and etching steps, the report notes.
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