April 23, 2025

Silicon Whiplash: Chips, Cuts

Round-up

Highlights

  1. Intel swings the axe – 20 %+ workforce cut incoming. New CEO Lip-Bu Tan will announce the first phase of deep layoffs this week as he tries to reboot Intel’s engineering culture and stop share-loss to TSMC and Nvidia 12.
  2. Washington flirts with an outright semiconductor tariff. A White House study floated “component-tariffs” on foreign-made chips; allies warn the move could raise costs without reshoring production 3.
  3. Memory suppliers hike prices ahead of tariff deadlines. Spot DRAM quotes jumped 8-10 % overnight as PC and server makers stockpile inventory, while Micron joined Samsung in cutting legacy DDR4 output 45.

Other developments

  • BE Semiconductor (Besi) bookings up 8 % on hybrid-bonding demand 6
  • Industry group tells BIS that current export controls are driving customers off U.S. silicon 7
  • Nvidia touts 300× water savings with Blackwell direct-to-chip cooling 8
  • Short selling in SK Hynix hits a record after Korea ends its ban 9
  • Tower Semi sets 14 May for Q1 earnings & guidance 10
  • Huawei’s Ascend 910C AI GPU said to enter mass shipment in May 11
  • Teledyne beats on Q1 earnings as defence sensor demand stays strong 12

Did you know?
Hybrid-bonding orders for HBM 4 packaging now account for over 40 % of Besi’s total backlog, the first time an advanced-memory node has dominated the Dutch toolmaker’s pipeline 6.


In-depth

1. Government & Corporate Policy

  • U.S. semiconductor tariff blueprint

    • Treasury memo weighs a flat ad-valorem duty or “component tariff” tied to chip value in finished goods 3.
    • Economists warn broad levies could simply accelerate offshore assembly rather than on-shoring fabs.
    • Targeted China-only duties would be symbolic – Chinese dies make up <5 % of chips entering the U.S. supply chain.
  • Export-control backlash reaches BIS

    • Semiconductor Industry Coalition told regulators the October rules are “forcing buyers toward non-U.S. alternatives within two quarters” 7.
    • Companies urged faster licence processing and clearer de-minimis thresholds for design IP.
    • BIS officials said tweaks are possible but a wholesale rollback is unlikely.
  • South Korea lifts 18-month short-selling ban

    • Immediate result: bearish bets on SK Hynix spiked to an all-time high 9.
    • Traders cite AI demand uncertainty and looming U.S.-China trade friction.
    • Seoul regulators signalled they will intervene if “excessive volatility” emerges.
  • Intel’s radical head-count reset

    • >20 % cuts target overlapping management layers and legacy client-PC groups 12.
    • Move follows board’s ouster of Pat Gelsinger and aims to free cash for 18A foundry ramp.
    • Street sees ~$4 bn annual savings but worries about brain-drain in key design teams.

2. Economics, Finance & Business Outlook

  • Memory price spike

    • TrendForce spot survey shows 8-10 % DRAM jump in one session 4.
    • Buyers racing to beat anticipated reciprocal tariffs that start 1 May.
    • Contract negotiations for Q2 already resetting 5-7 % higher.
  • Micron joins Samsung in trimming DDR4

    • Both vendors shifting wafer starts to HBM and DDR5 ahead of AI server demand 5.
    • Taiwan IC packagers expect a windfall in legacy DIMM work.
    • PC-OEMs face renewed cost pressure just as laptop demand stabilises.
  • Besi rides the HBM 4 wave

    • Q1 orders +8.2 % q/q to €132 m; hybrid-bonding tools secured from two top DRAM makers 6.
    • Revenue still -6 % on weak smartphone and auto, but CEO flags “AI-led up-cycle from late-2025.”
    • Shares popped 9 % on the print.
  • SK Hynix under siege

    • Short interest hits record as traders bet on tariff drag and slowing AI euphoria 9.
    • Company reports Thursday; focus is on HBM3E margin disclosure.
    • Korean regulators monitoring for naked-short violations post-ban-lift.

3. Technology & R&D

  • Blackwell racks go closed-loop

    • Nvidia claims GB200/GB300 systems use direct-to-chip liquid cooling that is 300× more water-efficient than traditional evaporative towers 8.
    • Coolant distribution units rated at up to 2 MW enable 120-140 kW racks.
    • Reference designs with Schneider Electric aim to ease data-centre retrofits.
  • Huawei Ascend 910C mass production

    • Dual-die package doubles compute over 910B, chasing Nvidia H100-class perf 11.
    • Built on SMIC N+2 7 nm; first cloud shipments expected in June.
    • U.S. export curbs on Nvidia H20 make 910C the default China AI accelerator.
  • Tower Semi readies Q1 scorecard

    • April 23 release set earnings date and guidance call for 14 May 10.
    • Analysts will look for colour on RF-SOI demand and Intel foundry overlap.
  • Teledyne sensor surge

    • Imaging-segment sales +2.2 % y/y to $757 m on defence opto-electronics 12.
    • Management keeps FY-25 outlook despite tariff fog, citing backlog visibility.

Footnotes