US Imposes Chip Restrictions Over Concerns Of Chinese Military's Use Of Semiconductor Technology
Portfolio Pulse from Nabaparna Bhattacharya
The US is imposing restrictions on the procurement of vital spare parts for chip equipment to slow down China's progress in the semiconductor sector. This move is part of a broader effort to deter China's technological strides in the semiconductor realm, following Huawei's launch of a 5G smartphone equipped with an advanced 7-nanometer chip manufactured by SMIC. The US has also collaborated with Japan and the Netherlands to target China's acquisition of cutting-edge chipmaking technology and essential spare parts. Companies like ASML Holding NV and Nvidia Corporation are expected to benefit from these restrictions.
October 22, 2023 | 1:44 am
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POSITIVE IMPACT
Nvidia Corporation appears to be navigating the US restrictions well, capitalizing on the gaps left by Chinese firms grappling with the US sanctions.
The US restrictions on chip equipment procurement are creating opportunities for Nvidia. As Chinese firms struggle with the sanctions, Nvidia is capitalizing on these gaps, which could potentially boost its market performance.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70
NEGATIVE IMPACT
ASML Holding NV continues to deliver sophisticated equipment to China, but such transactions are expected to dwindle by 2024 due to US restrictions.
The US restrictions on chip equipment procurement are expected to impact ASML's business with China. As the restrictions tighten, ASML's transactions with China are expected to decrease, potentially affecting the company's revenue.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70