Taiwan's semiconductor test solution providers are poised for strong growth in 2025, driven by rising demand for AI, HPC, and ASICs. With wafer foundries and OSAT providers expanding capacity, firms like MPI Corp., WinWay Technology, Chunghwa Precision Test Tech., Keystone Microtech, and Hermes Testing Solutions have reported record annual revenues, highlighting the sector's robust momentum.
Record profits. Soaring margins. Relentless demand. TSMC's January 15, 2026, earnings call painted a picture of semiconductor dominance so complete it seems almost untouchable. Almost.
With China and Japan launching successive anti-dumping probes and export controls on rare earths and key semiconductor materials, the risk of China's advanced-process supply chain being "choked" by critical material shortages is rising.
Vietnam's Ministry of Science and Technology has decided to establish a national center for semiconductor chip prototyping, a move aimed at developing high-quality human resources and supporting businesses in one of the country's fastest-growing technology sectors.
According to Business Insider, Elon Musk, CEO of Tesla and founder of xAI, recently highlighted China's dominant position in AI computing power during a podcast, warning that the country will far surpass others globally in supporting AI operations.
Soaring demand for high-end computing power, combined with geopolitical pressure and supply-chain constraints, is reshaping China's AI chip market at a structural level. Bernstein estimates that Huawei's share of China's AI chip market rose from about one-third of Nvidia's level in 2024 to reach parity with Nvidia in 2025. The shift marks a new phase in which domestic suppliers are taking the lead.
The US and Taiwan reached a trade agreement on January 15, 2026 (US time), cutting reciprocal tariffs on most Taiwanese goods from 20% to 15% without stacking them onto existing most-favored-nation rates. Taiwan's Executive Yuan said semiconductors and related products will receive the most favorable treatment under Section 232 of the Trade Expansion Act. The pact also includes commitments on supply-chain investment and strategic cooperation in artificial intelligence.
South Korean industry and government officials are monitoring a new trade agreement between the US and Taiwan that links semiconductor investment to import duty exemptions, with officials in Seoul saying that any future US-South Korea talks should not leave Korea worse off than Taiwan. Officials view the terms as a potential benchmark for future US-South Korea trade negotiations.
Taiwan's Executive Yuan announced early Thursday that it had secured preferential tariff treatment from the United States on semiconductors and related products, marking a significant breakthrough in bilateral trade negotiations amid intensifying geopolitical and supply-chain pressures.
At its earnings call on January 15, 2026, TSMC signaled that its capital expenditures for 2026 will increase to US$52-56 billion, far exceeding market expectations. On top of demand for new capacity buildouts, the company also emphasized during the call that development costs for each new advanced process node have risen significantly compared to the previous generation. While TSMC stressed that it will not adopt opportunistic price hikes, it will continue to insist on earning the appropriate value for its technology.
The United States and Taiwan formalized a significant trade and investment agreement on January 15, 2026, establishing a new framework for bilateral economic relations.
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