Chip Industry Ditches US for China

Also in today's edition: Google’s Brain is in Deep Mind, Inside Demis Hassabis’ Mind

The Biden administration is employing every trick of the trade to prevent companies from exploring business with China. In fresh assault, the US, under the Chips Act, is incentivising its semiconductor companies by offering federal grants and proposing restrictions that would make it difficult for them to expand their China operations.

Although it’s a fantastic move to boost your business and sabotage others, sadly for the US, most companies are not biting the bait and are ready to forgo the US’ grants for the love of China. Last week, CEOs of Qualcomm, ASML, and Apple visited China and met government officials to strengthen old ties and further cement their presence in the country.

China is not only a manufacturing hub for semiconductors, but also the world’s largest consumer. In 2020, Beijing bought 53.7% of the world’s supply of chips worth around $240 billion. The country holds the majority of the business of semiconductor companies. In 2022, Qualcomm’s 50% and NVIDIA’s 26.3% revenues came from China. ASML had 14% of its sales in the country and Apple recorded 24%.