Shares of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday tumbled 2.23 percent as investors cautioned of the adverse effects of a US ban on using products from China’s Huawei Technologies Co Ltd (華為).
TSMC supplies advanced 7-nanometer processors to HiSilicon Technologies Co (海思半導體), the chip-designing arm of Huawei.
Shares of TSMC fell to NT$241.5, contributing to a NT$609.36 billion (US$19.47 billion) drop in market capital for the company since May 5, when US President Donald Trump tweeted that the US would hike tariffs on US$325 billion of Chinese goods.
Trump on Thursday signed an executive order declaring a national emergency that would ban US companies from using telecommunications equipment made by firms that might pose national security risks.
The US Department of Commerce later added Huawei and its affiliates to the Bureau of Industry and Security’s “Entity List,” barring the companies from procuring components and technology from US firms without government approval.
Huawei’s handset manufacturing and even sales might have to shut down completely due to the ban, Yuanta Securities Investment Consulting Co (元大投顧) said.
That might mean an order loss for TSMC, which mainly provides high-end processors such as its 7-nanometer Kirin 980 chipset to Huawei, the investment consultant said.
“The impact would likely be neutral,” as the loss might be compensated by order gains from MediaTek Inc (聯發科) or Qualcomm Inc, Yuanta said.
Washington might next ban US companies from exporting key components to China, or even from selling software to Huawei, it said.
“Our channel checks suggest that the market generally believes Huawei has raised its inventory to a level that would enable it to meet seven months of demand,” Yuanta said.
Even if the US bars component exports to China across the board, the effects on Huawei should be limited in the short term, it said.
TSMC is not the only firm in Huawei’s supply chain to suffer the brunt of the US ban.
Shares of Largan Precision Co (大立光), which supplies camera lens to Huawei and Apple Inc, yesterday plunged 9.41 percent to NT$3,850.
Since May 5, Largan’s market value has tumbled NT$110.67 billion.
The US ban might weigh on Huawei’s handset sales growth this year, Yuanta said, adding that Huawei mainly purchased camera lens and flat panels from Taiwanese suppliers.
Hon Hai Precision Industry Co (鴻海精密) yesterday said that its research institute has launched its first advanced artificial intelligence (AI) large language model (LLM) using traditional Chinese, with technology assistance from Nvidia Corp. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), said the LLM, FoxBrain, is expected to improve its data analysis capabilities for smart manufacturing, and electric vehicle and smart city development. An LLM is a type of AI trained on vast amounts of text data and uses deep learning techniques, particularly neural networks, to process and generate language. They are essential for building and improving AI-powered servers. Nvidia provided assistance
DOMESTIC SUPPLY: The probe comes as Donald Trump has called for the repeal of the US$52.7 billion CHIPS and Science Act, which the US Congress passed in 2022 The Office of the US Trade Representative is to hold a hearing tomorrow into older Chinese-made “legacy” semiconductors that could heap more US tariffs on chips from China that power everyday goods from cars to washing machines to telecoms equipment. The probe, which began during former US president Joe Biden’s tenure in December last year, aims to protect US and other semiconductor producers from China’s massive state-driven buildup of domestic chip supply. A 50 percent US tariff on Chinese semiconductors began on Jan. 1. Legacy chips use older manufacturing processes introduced more than a decade ago and are often far simpler than
STILL HOPEFUL: Delayed payment of NT$5.35 billion from an Indian server client sent its earnings plunging last year, but the firm expects a gradual pickup ahead Asustek Computer Inc (華碩), the world’s No. 5 PC vendor, yesterday reported an 87 percent slump in net profit for last year, dragged by a massive overdue payment from an Indian cloud service provider. The Indian customer has delayed payment totaling NT$5.35 billion (US$162.7 million), Asustek chief financial officer Nick Wu (吳長榮) told an online earnings conference. Asustek shipped servers to India between April and June last year. The customer told Asustek that it is launching multiple fundraising projects and expected to repay the debt in the short term, Wu said. The Indian customer accounted for less than 10 percent to Asustek’s
Gasoline and diesel prices this week are to decrease NT$0.5 and NT$1 per liter respectively as international crude prices continued to fall last week, CPC Corp, Taiwan (CPC, 台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. Effective today, gasoline prices at CPC and Formosa stations are to decrease to NT$29.2, NT$30.7 and NT$32.7 per liter for 92, 95 and 98-octane unleaded gasoline respectively, while premium diesel is to cost NT$27.9 per liter at CPC stations and NT$27.7 at Formosa pumps, the companies said in separate statements. Global crude oil prices dropped last week after the eight OPEC+ members said they would
RSS