US Chipmakers Want More Subsidies As AI Shapes The Semiconductor Industry
Portfolio Pulse from Anusuya Lahiri
US chipmakers, including Nvidia Corp and Advanced Micro Devices, Inc (AMD), are seeking additional federal subsidies as demand for AI technology chips surges, with requests totaling over $70 billion against the $39 billion allocated. The U.S. aims to increase domestic semiconductor production to reduce reliance on foreign chips and strengthen its supply chain. AMD is entering the AI accelerator market with its MI300 chip, targeting a market expected to exceed $400 billion in the next four years. Both AMD and Nvidia have seen significant stock gains this year, though concerns about Nvidia's valuation sustainability have been raised.
February 27, 2024 | 7:14 pm
News sentiment analysis
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NEUTRAL IMPACT
Nvidia Corp is at the forefront of AI technology chip production, benefiting from increased Big Tech investment in AI. The company has seen over 64% stock price increase year-to-date, though concerns about valuation sustainability have emerged.
Nvidia's significant role in AI chip technology and its substantial stock gains highlight its importance. However, the concerns about its valuation sustainability could temper investor enthusiasm short term.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 90
POSITIVE IMPACT
AMD is expanding into the AI accelerator market with its MI300 chip, targeting a rapidly growing sector. The company's stock has gained 27% year-to-date, with positive outlooks for its server CPU market share and AI chip revenues.
AMD's entry into the AI market with promising products and its significant stock performance indicate a positive short-term impact. Its strategic moves in AI and server CPUs support a bullish outlook.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 95
POSITIVE IMPACT
AMD's collaboration with Taiwan Semiconductor Manufacturing Co (TSM) supports its growth in the server CPU market share, highlighting TSM's role in enabling AMD's expansion.
TSM's collaboration with AMD not only aids AMD's market share growth but also positions TSM as a key player in the semiconductor manufacturing industry, potentially benefiting from the increased focus on domestic production.
CONFIDENCE 75
IMPORTANCE 75
RELEVANCE 70