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Chip makers Intel and AMD fluctuated on Wednesday after Intel confirmed a small revenue hit to the SEC in a filing after the U.S. government levied fresh sanctions against the Chinese technology firm Huawei. Intel was down by almost 3% and kept a flat line during most of the trading day, while AMD initially jumped by more than a percent only to rapidly lose these gains.
Intel's filing came at a time when the firm is investing heavily in leading-edge semiconductor manufacturing technology to allow it to capture the global contract chip manufacturing market in an industry dominated by Taiwan's TSMC and its close partnership with Apple for manufacturing smartphone processors.
Fresh China Chip Export Ban Accompanied By Industry Report On Growth In U.S. Chip Manufacturing Capacity
Intel's SEC statement shared that even though its revenue guidance for the current quarter remained unchanged due to the U.S. export control actions, the firm now expects to post earnings results lower than the midpoint. The announcement didn't impress Wall Street, as Intel's shares had tumbled by 2.85% roughly an hour after noon.
A key part of Intel's Chinese sales is AMD since it is the only large scale alternative to the x86 chips that power laptops and other computers. Intel's ability to sell some chips to China has irked AMD because AMD has been unable to secure approval for its competing product.
AMD's share price performance on the day Intel's SEC filing confirmed the licensee revocations saw the shares, which had opened lower, jump by as much as 1.45% less only to lose the gains later on. Qualcomm's shares also opened lower but ended up trading flat during the day.
Since it's a chip manufacturer and not a designer, Intel has been able to work closely with the U.S. government in efforts to boost U.S. chip manufacturing capabilities. Fueled under the CHIPS Act, the Commerce Department has offered companies billions of dollars in funds to develop advanced chip manufacturing facilities inside America. This funding, which has already signed agreements with TSMC, Intel and memory manufacturer Micron, has also won the Semiconductor Industry Association's (SIA) approval.
The SIA, an industry group that has supported the CHIPS Act, shared in its report today that the U.S. is set to attract "is expected to attract $646 billion in capital investments" out of the $2.3 trillion global pie. Through these investments, the SIA projects that the U.S. share of global chip fabrication capacity for products with feature sizes smaller than 10-nanometer will grow from negligible to 28% by 2032.
Intel has focused on advanced chip manufacturing machines through its investments in newer machines called High NA EUV machines. These machines offer the promise of increasing production efficiency to gain a foothold in 2-nanometer and advanced chips. One Intel chip made by non-High NA EUV machines is the Core 9 Ultra, and Huawei also updated its site with the chip yesterday as part of the Matebook X Pro laptop's release.
About the author: Ramish is a seasoned technology writer and editor with more than a decade of experience. He specializes in semiconductor fabrication and market analysis. With a background in finance and supply chain management - via his bachelors in Finance and a micromasters in supply chain management from MIT - Ramish combines financial rigor with deep industry insight to deliver accurate and authoritative coverage.
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