chip shortage persists: how nvidia, tsmc, and asml are weathering the storm
Global, Friday, 28 March 2025.
the semiconductor industry is still facing significant challenges in march 2025. chip shortages and supply chain disruptions continue to impact major players like nvidia, asml, and tsmc. a european think tank review indicates a staggering 125% surge in the chip industry’s energy consumption over the past eight years. this coincides with the eu’s ambitious chips act, aiming to double europe’s global semiconductor output share by 2030, creating a complex situation.
sustainability initiatives gain traction
The eu is actively promoting cleaner chip manufacturing through funding research into energy-efficient techniques, advanced recycling, and alternative lithography [1]. These initiatives are designed to align with sustainability goals. The eu also seeks international collaboration with taiwan, south korea, and the u.s. to establish shared sustainability standards [1]. Digital twin technology is emerging as a key tool. Cadence reports that 73% of decision-makers see digital twins driving data center innovation, with 81% already using this technology [1]. This shift towards sustainability could influence investor sentiment, favoring companies adopting eco-friendly practices [GPT].
u.s. chips act faces headwinds
The u.s. chips act, which spurred over $400 billion in investments, is facing opposition [1]. President trump has criticized the act’s effectiveness, stating, “your chips act is a horrible, horrible thing” [1]. Intel’s $28 billion semiconductor factory in ohio is experiencing delays due to logistical and workforce challenges [1]. tsmc also delayed its arizona production due to labor shortages [1]. These delays and political headwinds could impact investor confidence and potentially lower stock valuations for companies banking on the chips act [GPT].
china’s growing capabilities
China is rapidly advancing its semiconductor capabilities. A kistep report indicates that china has surpassed south korea in foundational capabilities across all technology sectors, except advanced packaging [1]. In 2024, china scored 94.1% in high-density resistive memory technology, compared to south korea’s 90.1% [1]. Kistep also notes china’s gains in ai semiconductors and power semiconductors [1]. This progress raises concerns about a potential “flood of dram components,” impacting market dynamics and potentially affecting the competitive landscape for existing players [1]. Investors should monitor these developments closely [GPT].
geopolitical tensions and trade
Geopolitical tensions and trade policies are significant factors. The u.s. is considering new tariffs on china, potentially around 25%, impacting semiconductors [1]. The semiconductor industry association (sia) president, john neuffer, acknowledges tariffs as a trade tool but cautions that they could increase the cost of made-in-america semiconductors [1]. Increased tariffs and trade barriers could lead to higher costs, supply chain risks, and market fragmentation [4]. Investors must consider these geopolitical factors when assessing the long-term prospects of semiconductor companies [GPT].
semi forecasts growth amid uncertainty
Despite the challenges, semi forecasts growth for the semiconductor industry. Semi global vice president jürong anticipates double-digit growth in global semiconductor sales for 2025 [4]. He projects the industry will reach $1 trillion by 2030, sooner than previously expected [4]. Jürong highlights major trends like geopolitical shifts, trade disruptions, and the ai revolution [4]. He emphasizes that ai’s development will drive the semiconductor industry towards this trillion-dollar milestone [4]. This positive outlook provides a counterbalance to the risks, suggesting potential opportunities for investors [GPT].