Biden administration targets Chinese companies over Taiwanese semiconductor chips found at Huawei – Taiwan Semiconductor (NYSE:TSM)

Sofgo, a Chinese company that owns Taiwan Semiconductor Manufacturing Co., Ltd. TSMHuawei chips reportedly found in Huawei’s artificial intelligence processors could be blacklisted by the US

Bitcoin mining equipment supplier Sofgo, owned by Bitmain, is the latest Chinese company to be included on the U.S. semiconductor embargo list due to national security threats, Reuters reports. .

In October, technology research firm TechInsights reportedly discovered that the Huawei 910B was equipped with a Taiwanese semiconductor chip, reported it to the chip manufacturer, and notified the US Department of Commerce.

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Taiwan Semiconductor has decided that the chips match Sofgo’s design and has stopped shipping them to the company.

Sofgo, a supplier to local governments and state-owned enterprises such as China Telecom, denied the charges in October. According to Reuters, Huawei also denied the allegations.

On November 11, the United States asked Taiwan Semiconductor to stop shipping advanced chips larger than 7 nanometers to China. U.S. sanctions prohibit exporters from shipping goods or technology without a license, which is likely to be refused.

In December, the U.S. government imposed sanctions on 140 Chinese semiconductor companies, including chip equipment makers such as Nowra Technology Group, for advanced memory chips and chip-making tools.

In 2019, the United States added telecommunications equipment maker Huawei to its Entity List and restricted its access to foreign chips starting in 2020. But over the past two years, China’s state-run universities and police departments developing AI tools have splurged on Sofgo and Bitmain’s AI. Upgrade chip functionality.

US sanctions have forced Huawei to diversify into an AI chip powerhouse. China considers Huawei’s Ascend 910B to be the country’s most advanced AI chip. Huawei plans to commercialize Ascend 910C in early 2025 to compete with Nvidia NVDA.

Taiwan semiconductor stocks are rising on Monday. As of the end of last week, the Taiwanese contract semiconductor maker’s stock was trading at a roughly 25% premium to its domestic market share, indicating investors’ confidence in the AI ​​craze, Bloomberg reported. .

This was a record premium since Oct. 17 and was higher than the daily average of 19% in the same quarter.

Price Action: TSM stock was up 1.75% at a pre-market price of $200.67 at last check on Monday.

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