South Korea plans to strengthen measures to prevent the overseas leakage of business secrets as global competition for advanced technology intensifies, according to Finance Minister Choi Sang-mok. The government will implement a “big data” system at the patent agency to monitor potential leaks and introduce stricter regulations with tougher penalties for offenders, although details on the punishments were not provided.
The National Intelligence Service reported 97 attempts to leak business secrets to foreign countries over the past five years, 40 of which targeted the semiconductor sector. If successful, these breaches could have caused losses of approximately 23 trillion won ($16.85 billion). Recently, a South Korean executive accused of stealing Samsung Electronics’ chip technology was detained again over new allegations.
In response to global competition and supply chain challenges, South Korea has identified 12 sectors, including semiconductors, rechargeable batteries, aerospace, and AI, as ‘national strategic technologies.’ These industries receive targeted support and protection to boost the country’s technological leadership.
The Cybersecurity Association of China (CSAC) has urged a security review of Intel’s products in China, alleging that the US chipmaker poses a national security risk. Although CSAC is an industry group, it has strong connections to the Chinese government, and its claims may prompt action from the Cyberspace Administration of China (CAC).
CSAC’s post on WeChat accuses Intel’s chips, including its Xeon processors used for AI, of containing vulnerabilities and backdoors allegedly tied to the US NSA. The group warns that using Intel products threatens China’s national security and critical infrastructure.
This recommendation comes amid growing US-China tensions over technology and trade. Last year, the CAC banned Chinese infrastructure operators from using products from Micron Technology after a security review, raising concerns that Intel could face a similar outcome.
Intel’s China unit responded, emphasising its commitment to product safety and quality. The company stated on its WeChat account that it will cooperate with authorities to clarify concerns. If the CAC carries out a security review, it could impact Intel’s sales in its significant Chinese market. Intel’s shares recently dropped 2.7% in US premarket trading.
Wolfspeed is set to receive $750 million in government grants for its new silicon carbide wafer manufacturing plant in North Carolina, as announced by the US Commerce Department. This funding news caused the US chipmaker’s shares to surge over 30%. The preliminary agreement requires Wolfspeed to strengthen its balance sheet to safeguard taxpayer funds.
Investment firms, led by Apollo Global Management, have pledged an additional $750 million in financing for Wolfspeed. The company produces energy-efficient chips using silicon carbide, crucial for applications like electric vehicles and renewable energy systems. As part of a larger $6 billion expansion plan, Wolfspeed aims to increase its manufacturing capacity in Marcy, New York.
Wolfspeed anticipates up to $1 billion in cash tax refunds from the advanced manufacturing tax credit under the Chips and Science Act. CEO Gregg Lowe highlighted the significance of Wolfspeed’s products to the US economy and national security. However, the company has encountered difficulties this year, with its stock plummeting nearly 75% due to a decline in electric vehicle demand. The grant remains subject to due diligence and is not yet finalised.
ASML’s lowered 2025 sales forecast has triggered a significant sell-off in semiconductor stocks, reflecting concerns over global chip demand. While the Dutch company’s revised forecast indicated €30 billion to €35 billion in net sales, this figure sits near the bottom of previous projections. Its stock plunged to record its biggest one-day drop in 25 years, sending shockwaves throughout the chipmaking sector.
The shift in outlook suggests that factory overcapacity, rather than weak demand, is affecting orders. Many manufacturers, including Intel, Samsung, and TSMC, had stocked up on ASML’s advanced tools during the pandemic. As production efficiency improved, fewer new machines were needed to keep up with stabilising demand. Analysts noted that chip factories have become better at maximising output with existing equipment.
Chip usage at production facilities remains around 81%, far from the 95% threshold where manufacturers typically invest in new tools. Industry experts also reported that new technology could reduce the reliance on ASML’s machines. Samsung, for example, is exploring advanced chip-etching techniques to minimise the use of ASML’s extreme ultraviolet lithography machines, potentially creating excess capacity.
Despite challenges, analysts maintain an optimistic long-term outlook for the semiconductor industry. AI-related chips and memory solutions remain in high demand, though the broader market continues to experience some volatility. Experts believe the current slowdown is a temporary phase before the sector resumes growth.
Intel and AMD are teaming up to ensure software compatibility across their x86 chips in response to competition from Arm Holdings. For decades, Intel’s x86 architecture has powered laptops, PCs, and servers, with AMD licensing the technology to make its own competing chips. However, Arm’s market share has grown, partly due to its contracts requiring that all Arm chips support Arm software universally.
In response, Intel and AMD have formed an advisory group that includes major industry players such as Broadcom, Dell Technologies, Lenovo, and Oracle. The group’s objective is to establish consistent and compatible standards for x86 chips by combining expertise from the hardware and software sectors.
At a Lenovo event in Seattle, Intel CEO Pat Gelsinger highlighted the flexibility of x86 technology for AI-enabled laptops, stating that the architecture is still strong and poised for growth and innovation as AI advances.
Chip stocks took a sharp hit after ASML, a leading chip equipment maker, lowered its annual sales forecast due to weak demand for non-AI chips. This downturn raised concerns about the broader semiconductor market, even as AI-related chips remain in high demand. Nvidia, a major player in the AI chip sector, saw its stock drop 4.5%, erasing $158 billion in market value, while other key chipmakers like AMD, Intel, and Micron also saw declines.
ASML’s early results revealed a slowdown in bookings and delayed orders from logic chip manufacturers, as well as limited new capacity plans from memory chip makers. This caused US and Asian semiconductor stocks to slide, with the Philadelphia Semiconductor Index down nearly 5%. Despite growth in AI chips, the overall chip market remains under pressure, with many factories holding off on new equipment purchases as demand stabilises.
The chip industry had expanded rapidly during the pandemic, but now faces a period of slower recovery outside the AI segment. Adding to the uncertainty, US officials are considering restrictions on exporting AI chips to certain countries over national security concerns, further complicating the outlook for the sector.
A significant collaboration between Taiwan’s PSMC and Japan’s SBI Holdings to build a semiconductor fab in Japan has been abruptly halted. PSMC informed SBI Holdings in late September that it could not proceed with the project, initially promised a year ago. SBI Holdings Chairman Yoshitaka Kitao expressed his frustration on social media, accusing PSMC of dishonesty and labelling the breakup as ‘a blessing in disguise.’
Kitao criticised the dissolution of the partnership, stating it was the first time SBI had to end a collaboration almost unilaterally after making significant concessions. He recalled discussions with key government officials and detailed plans for receiving Japanese government subsidies, only to be let down by PSMC’s failure to honour commitments. According to reports, PSMC cited an unwillingness to assume the risks associated with the project, leading to the termination of plans for the facility in Miyagi Prefecture, which was expected to start production by 2027.
The decision comes as PSMC has faced challenges in the semiconductor market, including oversupply issues from Chinese firms, resulting in operating losses for five consecutive quarters since Q2 2023. While PSMC intended to offer consulting, training, and technology transfer under a Fab IP model without directly investing in the factory, it raised concerns about the conditions set by Japan’s Ministry of Economy, Trade and Industry regarding operational guarantees.
US officials are considering restricting the sale of advanced AI chips from Nvidia and other American firms to certain countries, focusing on the Persian Gulf region. These deliberations aim to limit exports based on national security concerns, Bloomberg News has reported, citing sources familiar with the discussions.
The idea has gained traction in recent weeks, although plans remain in early stages and may change. Neither the US Commerce Department nor Nvidia commented on the matter. Intel and AMD also did not immediately respond to inquiries from Reuters.
Recent regulatory updates from the Commerce Department could simplify the export process. Data centres in the Middle East may apply for Validated End User status, enabling them to obtain AI chips through a general authorisation, bypassing the need for individual export licences.
In 2023, the Biden administration expanded licensing rules to tighten AI chip exports to over 40 countries, including some Middle Eastern nations, amid concerns that exports might be diverted to China or used in ways conflicting with US security interests.
Japanese companies Rapidus and Denso are set to collaborate on creating standardised design methods for advanced chips, which will be used in sectors such as AI and self-driving vehicles. The collaboration marks a significant step for Japan as it leads efforts to develop cutting-edge chip technology.
This is the first time Japanese firms have taken the lead in standardising chip design methods. The initiative is aimed at boosting Japan’s competitiveness in the global chip market, where competition is fierce and innovation is key.
Rapidus and Denso will encourage other companies to join in sharing their chip designs. The shared methods are expected to reduce development time and production costs, fostering a more efficient approach to chip manufacturing.
By creating common design practices, the companies hope to speed up the development of advanced chips, making them more affordable to produce and further solidifying Japan’s position in the tech industry.
Advanced Micro Devices (AMD) is set to begin mass production of its latest AI chip, the MI325X, by the end of 2024. This move aims to boost AMD’s competitive position in a market largely dominated by Nvidia. The MI325X will be available in early 2025, designed to enhance AI processing speeds with new memory technology. AMD also plans to release a next-generation MI350 series in 2025 with an improved architecture and more memory for even greater performance.
Despite these announcements, AMD’s shares fell nearly 5%, as analysts were expecting new major cloud-computing clients to be revealed. AMD continues to face stiff competition from Nvidia, whose shares rose while Intel’s dipped amid the AI race. In addition to the new AI chips, AMD introduced server and PC processors based on its Zen 5 architecture, boasting faster speeds and optimised AI capabilities.
AMD’s CEO Lisa Su noted that the company would continue using Taiwan’s TSMC for manufacturing, and while no new clients were announced, demand for AI chips remains high. With an increased forecast for AI chip revenue, AMD is gearing up to meet surging market demand driven by generative AI.
