Taiwan's Ministry of Economic Affairs (MOEA) will launch the second phase of its subsidy program for domestic IC design houses in 2025, aimed at boosting their competitiveness against global industry leaders. This initiative continues despite a projected budget shortfall of NT$30 billion (US$914.07 million) for the year, as outlined in the recently amended Act Governing the Allocation of Government Revenues and Expenditures.
Despite ongoing geopolitical tensions and global economic policies impacting the electronics industry as the new year begins, demand for semiconductors, AI servers, and related components remains strong. The industry's performance is expected to be further enhanced by increased demand for smartphones and notebooks throughout 2025.
As artificial intelligence (AI) has been in bloom in recent years, Nvidia has achieved a remarkable milestone by surpassing a market capitalization of US$3 trillion for the first time in 2024. Throughout this year, Nvidia has actively invested in AI, including participation in startup financing and acquisitions, on par with other tech giants.
Taiwan has implemented comprehensive regulations to prevent the transfer of sensitive technologies, including advanced chips, to mainland China, reinforcing national security and economic interests.
Horizon Robotics, a Chinese manufacturer of intelligent driving chips, has announced its goal of shipping over 10 million chips in 2025, positioning itself to become the first Chinese company to achieve this level of mass production.
Chinese chip vendors' efforts to achieve self-sufficiency in automotive ICs have shown progress, but their advancement is hindered by a high barrier formed by European IDMs, according to industry sources.
Growing demand for artificial intelligence semiconductors is reshaping the global chip industry, but South Korea's ambitions to capture market share face significant hurdles despite the sector's explosive growth potential.
South Korea's Ministry of Trade, Industry, and Energy (MOTIE) has announced a KRW36.4 billion (US$24.79 million) investment to fund 48 next-generation semiconductor R&D projects by 2025. The initiative focuses on Processing-In-Memory (PIM) chips, advanced packaging, on-device AI semiconductors, system semiconductors, and compound power semiconductors.
UK-based semiconductor IP firm Imagination Technologies announced that its CEO, Simon Beresford-Wylie, will retire in 2025, and the company is seeking a successor. There is speculation that his resignation may be connected to allegations involving the transfer of critical technology to China.
A recent report has revealed that the CPU department under Arm China, a Chinese chip IP designer and service provider, has started laying off employees. The department consists of around 30-40 staff members. Even though the number of layoffs is not large, it still has a significant impact on Arm China given the scale of the company.
Rival semiconductor leaders Nvidia, AMD, and Intel have aligned in their support for Ayar Labs, a groundbreaking startup revolutionizing chip technology. In December, Silicon Valley-based Ayar Labs raised US$155 million in Series D funding, led by Advent International and Light Street Capital, elevating its valuation beyond US$1 billion and cementing its unicorn status.
Samsung Electronics, after previously securing orders for 2nm AI accelerators from Japanese AI startup Preferred Networks (PFN), is reportedly set to supply 2nm chips to a South Korean NPU company. Samsung's 2nm process is currently undergoing mass production testing.
Donald Trump's return to the US presidency, coupled with his appointment of hawkish cabinet members focused on China, signals the likelihood of escalated trade and technology sanctions against Chinese firms. Huawei, a key target during Trump's first term, is expected to face renewed pressure under his administration.
Taiwan's Legislative Yuan hastily passed amendments to the Act Governing the Allocation of Government Revenues and Expenditures without sufficient discussion, sparking major controversy and raising concerns about the government's ability to fulfill its policy commitments. Following warnings from the Ministry of Economic Affairs about the impact on subsidies for Nvidia, the National Science and Technology Council (NSTC) announced that NT$122 billion (approx. US$3.72 billion) in fundamental research projects would also be affected.
The IC design industry has seen demand in 2024 vary starkly across different applications: cloud AI-related demand continued to grow month by month, while the edge device sector was fraught with uncertainty throughout the year, going through a series of up and downs in a manifestation of the pessimistic outlook for the sector held by many in the supply chain.
The semiconductor industry witnessed unprecedented transformations in 2024, marked by strategic acquisitions, technological breakthroughs, and geopolitical tensions. As artificial intelligence continued to drive demand for advanced chips, major players repositioned themselves through partnerships and investments while navigating complex political landscapes and supply chain challenges. The year also saw quantum computing achievements and significant shifts in US semiconductor policy, reshaping the industry's future trajectory.
2024 revenue trends for IC design firms indicate modest growth among most Taiwanese companies, with MediaTek emerging as a standout performer. As full-year figures remain pending, industry analysts are closely watching to see if MediaTek's momentum will continue into 2025.
China's domestic CPU industry is experiencing rapid growth amidst intensifying US-China technological competition. At the forefront, Phytium announced that it has shipped over 10 million CPUs, setting a significant milestone in the evolution of China's semiconductor industry.
South Korea has expedited the approval of the Yongin Semiconductor National Industrial Complex. The strategic project aims to bolster the nation's semiconductor industry amid global competition and security concerns.
Broadcom has reached a historic milestone, surpassing a US$1 trillion market valuation amid the rapid growth of the artificial intelligence (AI) market. CEO Hock Tan expressed confidence in a continued AI investment surge through the late 2020s. He noted that within three years, Broadcom's clients aim to build extensive computing clusters equipped with millions of AI chips, driving significant market growth.
When Masayoshi Son made a surprise appearance at Mar-a-Lago alongside Donald Trump last week, the founder of Japan's SoftBank Group vowed to invest a stunning US$100 billion in the US over the next four years. The president-elect joked that perhaps SoftBank would like to double that target to US$200 billion. Not to be outdone, Son replied with a wide smile, "I will really try."
Security chip demand has remained subdued in 2024, falling short of pandemic-era peaks, with customers showing reluctance in inventory replenishment. Industry sources indicate that Taiwanese IC design firms face mounting pressure from Chinese competitors, who are now making inroads not only in core optical sensing technologies but also in peripheral chips.
The Ministry of Economic Affairs (MOEA) faces a projected budget cut of NT$29.7 billion (US$907.08 million) in 2025 following the Legislative Yuan's passage of amendments to the Act Governing the Allocation of Government Revenues and Expenditures. According to Economics Minister Jyh-Huei Kuo, the reduction will impact subsidies promised to foreign companies like Nvidia, Micron, and AMD for their Taiwan investments.
