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TSMC profits surge despite trade concerns

Taiwan Semiconductor Manufacturing Company (TSMC) posted a significant jump in quarterly profits, driven by robust demand for AI chips. Net income rose by just over 60% year-on-year to NT$360.7bn (£9.77bn), outpacing analysts’ expectations.

Revenue also grew by 41.6% compared to the same period in 2024, although it dipped slightly from the previous quarter due to weaker smartphone sales.

The world’s largest contract chipmaker has not yet seen any major changes in customer behaviour, including from Apple and Nvidia, despite increasing uncertainty over potential US tariffs on Taiwanese semiconductors.

While concerns about trade tensions grow, particularly with former President Donald Trump suggesting the US should reclaim chip production, TSMC says it is continuing with business as usual for now.

Instead of scaling back, TSMC is expanding its investment in the US, with plans to spend up to $160bn. Analysts believe this move could help the firm argue for a more favourable position should tariff negotiations intensify.

The company’s Chief Financial Officer, Wendell Huang, acknowledged the risks posed by changing trade policies but said revenue growth is still expected in the next quarter.

Despite global pressures, TSMC remains optimistic, forecasting revenue between $28.4bn and $29.2bn. Although the company’s shares have fallen more than 20% so far this year, some analysts say the stock is now undervalued and well-positioned to rebound once market conditions stabilise.

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DW Weekly #208 – US tariffs, the digital trade and digital policies court battles

12 – 18 April 2025

Nature, Outdoors, Sea, Water, Animal, Dinosaur, Reptile, Mammal

Dear readers,

Last week, we focused on the effects that the global trade war is producing worldwide. After President Trump’s administration increased tariffs, forcing major tech firms to rethink their strategies urgently, Apple swiftly responded to the looming trade barriers by orchestrating a record-breaking $2 billion iPhone airlift from India to the US, strategically sidestepping the elevated tariffs.

Meanwhile, the US has temporarily exempted certain critical electronics imported from China, including smartphones and semiconductor components, from tariff hikes.

The ripple effects of the US tariffs extend beyond US borders. South Korea, heavily reliant on its semiconductor exports, has launched an ambitious $23 billion investment into its domestic chip industry.

Parallel to the tariff turmoil, major US tech firms are embroiled in intensifying legal disputes concerning digital market dominance. The US Justice Department is pursuing legal action against Google, alleging monopolistic practices within its search and advertising services.

Echoing similar concerns, the Federal Trade Commission (FTC) is challenging Meta’s stronghold on the social media market, marking a critical moment in US antitrust enforcement.

These legal confrontations are not confined to the US. Japan recently directed Google to address its dominant position on Android search services, pressing for enhanced competition and user choice.

In Europe, X (formerly Twitter) faces heightened scrutiny over its AI data-use policies, as the EU regulators investigate potential misuse of user data.

Additionally, Meta has confirmed plans to utilise the EU user data for AI model training, prompting regulatory concerns and further legal scrutiny.

For the main updates and reflections, consult the Radar and Reading Corner below.

DW Team

RADAR

Highlights from the week of 12 – 18 April 2025

Crypto leaders gather in Moscow for the Global Blockchain Forum 2025

The Global Blockchain Forum will bring together international crypto experts to discuss Bitcoin, adoption trends, and Russia’s crypto future.

AI firm DeepSeek opens up on model deployment tech

Community gains from DeepSeek’s open-source contributions.

Trump-backed WLFI boosts crypto portfolio with SEI token acquisition

Despite significant investments, WLFI’s portfolio is down by $145.8 million, with losses primarily in its Ethereum holdings.

Beijing blames NSA for hacking Asian Games systems

Beijing claims US operatives targeted infrastructure and Huawei with NSA-led cyberattacks.

Panama City introduces cryptocurrency payments for public services

Mayor Mizrachi confirmed Panama City’s plan to facilitate cryptocurrency payments, using banks to convert assets into fiat currency.

eu flags in front of european commission 1

EU plans major staff boost for digital rules

Despite launching multiple probes under the Digital Services Act, the EU has yet to close any, prompting a recruitment push for its enforcement team.

amd launches new ai chips to take on leader nvidia

AMD warns of financial hit from US AI chip export ban

The US administration has tightened rules on AI chip exports, affecting AMD’s MI308 products and potentially causing major financial losses for the company.

Benchmark backlash hits Meta’s Maverick model

AI developers question Meta’s transparency after benchmark controversy.

nato flag north atlantic treaty organization flag waving

NATO allies strengthen cyber defenses against critical infrastructure threats

A cyber defence exercise involving 20 allied nations was held to strengthen coordination and improve response to attacks on critical infrastructure, led by NATO.

Most Bitcoin firms in El Salvador are inactive

Just 11% of El Salvador’s Bitcoin service providers are operational under the country’s Bitcoin Law, central bank data shows.

double exposure creative artificial intelligence icon with man hand writing notebook background neural networks machine learning concept

Hamburg Declaration champions responsible AI

As the global race to harness AI accelerates, a new international effort is working to ensure that progress doesn’t come at the cost of people or the planet.

View all updates

READING CORNER

Beyond the imitation game: GPT-4.5, the Turing Test, and what comes next

What happens when machines not only speak like us but begin to mirror the subtleties of our personalities, emotions, and intentions — and we can no longer tell the difference?

How concepts get their meaning – Diplo

How do words get their meaning? Aldo Matteucci shows how terms like ‘dispositif’ and ‘consul’ gain meaning not through definitions, but through repeated use in historical and political contexts.

UPCOMING EVENTS

23 April 2025

Demystifying AI: How to prepare international organisations for AI transformation?

The event will provide a timely discussion on methods, approaches, and solutions for AI transformation of International Organisaitons.

dig.watch

WIPO Conversation 11: AI and IP: Infrastructure for rights holders and innovation

Conversation on IP and AI will take place on April 23-24, 2025, focusing on the role of copyright infrastructure in supporting both rights holders and AI-driven innovation.

www.sdgaicompendium.org

Hamburg Declaration

The Hamburg Sustainability Conference (HSC) is a global gathering of leaders and changemakers from governments, international organizations, businesses, civil society, and academia. Together, they co-create innovative solutions for a sustainable and fair future. The next conference is scheduled for 2-3 June 2025.

AMD warns of financial hit from US AI chip export ban

AMD has warned that new US government restrictions on exporting AI chips to China and several other countries could materially affect its earnings.

The company said it may face charges of up to $800 million related to unsold inventory, purchase commitments, and reserves if it fails to secure export licences for its MI308 GPUs, now subject to strict control measures.

In a filing to the US Securities and Exchange Commission, AMD confirmed it would seek the necessary licences but admitted there is no guarantee they will be granted.

The move follows broader export restrictions aimed at protecting national security interests, with US officials arguing that unrestricted access to advanced chips would weaken the country’s strategic lead in AI, instead of preserving it.

AMD’s stock dropped around 6% following the announcement. Competitors are also feeling the impact. Nvidia expects charges of $5.5 billion from similar restrictions, and Intel’s Gaudi hardware line has reportedly been affected as well.

The US Commerce Department has defended the move as necessary to safeguard economic and national interests.

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EU plans major staff boost for digital rules

The European Commission is ramping up enforcement of its Digital Services Act (DSA) by hiring 60 more staff to support ongoing investigations into major tech platforms. Despite beginning probes into companies such as X, Meta, TikTok, AliExpress and Temu since December 2023, none have concluded.

The Commission currently has 127 employees working on the DSA and aims to reach 200 by year’s end. Applications for the new roles, including legal experts, policy officers, and data scientists, remain open until 10 May.

The DSA, which came into full effect in February last year, applies to all online platforms in the EU. However, the 25 largest platforms, those with over 45 million monthly users like Google, Amazon, and Shein, fall under the direct supervision of the Commission instead of national regulators.

The most advanced case is against X, with early findings pointing to a lack of transparency and accountability.

The law has drawn criticism from the current Republican-led US government, which views it as discriminatory. Brendan Carr of the US Federal Communications Commission called the DSA ‘an attack on free speech,’ accusing the EU of unfairly targeting American companies.

In response, EU Tech Commissioner Henna Virkkunen insisted the rules are fair, applying equally to platforms from Europe, the US, and China.

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AI chip production begins at TSMC’s Arizona facility

Nvidia has announced a major initiative to produce AI supercomputers in the US in collaboration with Taiwan Semiconductor Manufacturing Co. (TSMC) and several other partners.

The effort aims to create up to US$500 billion worth of AI infrastructure products domestically over the next four years, marking a significant shift in Nvidia’s manufacturing strategy.

Alongside TSMC, other key contributors include Taiwanese firms Hon Hai Precision Industry Co. and Wistron Corp., both known for producing AI servers. US-based Amkor Technology and Taiwan’s Siliconware Precision Industries will also provide advanced packaging and testing services.

Nvidia’s Blackwell AI chips have already begun production at TSMC’s Arizona facility, with large-scale operations planned in Texas through partnerships with Hon Hai in Houston and Wistron in Dallas.

The move could impact Taiwan’s economy, as many Nvidia components are currently produced there. Taiwan’s Economic Affairs Minister declined to comment specifically on the project but assured that the government will monitor overseas investments by Taiwanese firms.

Nvidia said the initiative would help meet surging AI demand while strengthening semiconductor supply chains and increasing resilience amid shifting global trade policies, including new US tariffs on Taiwanese exports.

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Apple’s $2 billion iPhone airlift from India dodges Trump’s tariffs

Apple has airlifted nearly $2 billion worth of iPhones from India to the US, dodging President Trump’s looming tariffs with a clever sidestep.

Customs data reveals that in March 2025, Apple’s key Indian partners, Foxconn and Tata, shipped a record-breaking haul to ensure the tech giant’s shelves stay stocked in one of its biggest markets.

Foxconn, Apple’s primary supplier in India, exported $1.31 billion worth of iPhones—models 13, 14, 16, and 16e—in March alone, matching the combined total of January and February.

Tata Electronics wasn’t far behind, sending $612 million worth of iPhone 15 and 16 models, a 63% surge from the previous month.

Together, their efforts pushed Foxconn’s year-to-date shipments from India to the US to $5.3 billion, a testament to India’s growing role as a manufacturing hub amid Apple’s pivot away from China.

The operation was a logistical feat, with Apple chartering at least six cargo jets to ferry 600 tons of iPhones from Chennai’s air cargo terminal to US cities like Los Angeles, New York, and Chicago, which took the lion’s share.

To pull it off, Apple worked with Indian authorities to slash customs clearance times at Chennai airport from 30 hours to just six, ensuring the iPhones beat the tariff clock.

One source described the move as a strategic play to ‘beat the tariffs,’ a gambit to keep costs down as Trump’s trade policies tighten the screws.

Trump’s tariffs tell a tale of their own—while April 2025 saw a 26% duty on Indian imports, far lighter than the 100 %+ rates slapped on China, the president later paused most duties except for China’s for three months.

Yet, he also granted temporary exemptions for smartphones and electronics from Chinese imports, though he hinted those breaks might not last.

Apple’s reliance on India signals a deeper strategy to diversify production and outmanoeuvre the unpredictable winds of US trade policy in a global market fractured by high tax impositions.

Nvidia hit by the new US export rules

Nvidia is facing fresh US export restrictions on its H20 AI chips, dealing a blow to the company’s operations in China.

In a filing on Tuesday, Nvidia revealed it now needs a licence to export these chips indefinitely, after the US government cited concerns they could be used in a Chinese supercomputer.

The company expects a $5.5 billion charge linked to the controls in its first fiscal quarter of 2026, which ends on 27 April. Shares dropped around 6% in after-hours trading.

The H20 is currently the most advanced AI chip Nvidia can sell to China under existing regulations.

Last week, reports suggested CEO Jensen Huang might have temporarily eased tensions during a dinner at Donald Trump’s Mar-a-Lago resort, by promising investments in US-based AI data centres instead of opposing the rules directly.

Just a day before the filing, Nvidia announced plans to manufacture some chips in the US over the next four years, though the specifics were left vague.

Calls for tighter controls had been building, especially after it emerged that China’s DeepSeek used the H20 to train its R1 model, a system that surprised the US AI sector earlier this year.

Government officials had pushed for action, saying the chip’s capabilities posed a strategic risk. Nvidia declined to comment on the new restrictions.

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AI firm DeepSeek opens up on model deployment tech

Chinese AI startup DeepSeek has announced its intention to share the technology behind its internal inference engine, a move aimed at enhancing collaboration within the open-source AI community.

The company’s inference engine and training framework have played a vital role in accelerating the performance and deployment of its models, including DeepSeek-V3 and R1.

Built on PyTorch, DeepSeek’s training framework is complemented by a modified version of the vLLM inference engine originally developed in the US at UC Berkeley.

While the company will not release the full source code of its engine, it will contribute its design improvements and select components as standalone libraries.

These efforts form part of DeepSeek’s broader open-source initiative, which began earlier this year with the partial release of its AI model code.

Despite this contribution, DeepSeek’s models fall short of the Open Source Initiative’s standards, as the training data and full framework remain restricted.

The company cited limited resources and infrastructure constraints as reasons for not making the engine entirely open-source. Still, the move has been welcomed as a meaningful gesture towards transparency and knowledge-sharing in the AI sector.

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Nvidia brings AI supercomputer production to the US

Nvidia is shifting its AI supercomputer manufacturing operations to the United States for the first time, instead of relying on a globally dispersed supply chain.

In partnership with industry giants such as TSMC, Foxconn, and Wistron, the company is establishing large-scale facilities to produce its advanced Blackwell chips in Arizona and complete supercomputers in Texas. Production is expected to reach full scale within 12 to 15 months.

Over a million square feet of manufacturing space has been commissioned, with key roles also played by packaging and testing firms Amkor and SPIL.

The move reflects Nvidia’s ambition to create up to half a trillion dollars in AI infrastructure within the next four years, while boosting supply chain resilience and growing its US-based operations instead of expanding solely abroad.

These AI supercomputers are designed to power new, highly specialised data centres known as ‘AI factories,’ capable of handling vast AI workloads.

Nvidia’s investment is expected to support the construction of dozens of such facilities, generating hundreds of thousands of jobs and securing long-term economic value.

To enhance efficiency, Nvidia will apply its own AI, robotics, and simulation tools across these projects, using Omniverse to model factory operations virtually and Isaac GR00T to develop robots that automate production.

According to CEO Jensen Huang, bringing manufacturing home strengthens supply chains and better positions the company to meet the surging global demand for AI computing power.

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Trump eyes tariffs on semiconductors in push to boost US tech manufacturing

US President Donald Trump is preparing to introduce new tariffs on semiconductor imports, aiming to shift more chip production back to the United States.

Semiconductors, or microchips, are essential components in everything from smartphones and laptops to medical devices and renewable energy systems.

Speaking aboard Air Force One, Trump said new tariff rates would be announced soon as part of a broader effort to end American reliance on foreign-made chips and strengthen national security.

The global semiconductor supply chain is heavily concentrated in Asia, with Taiwan’s TSMC producing over half of the world’s chips and supplying major companies like Apple, Microsoft, and Nvidia.

Trump’s move signals a more aggressive stance in the ongoing ‘chip wars’ with China, as his administration warns of the dangers of the US being dependent on overseas production for such a critical technology.

Although the US has already taken steps to boost domestic chip production—like the $6.6 billion awarded to TSMC to build a factory in Arizona—progress has been slow due to a shortage of skilled workers.

The plant faced delays, and TSMC ultimately flew in thousands of workers from Taiwan to meet demands, underscoring the challenge of building a self-reliant semiconductor industry on American soil.

Why does it matter?

Trump’s proposed tariffs are expected to form part of a wider investigation into the electronics supply chain, aimed at shielding the US from foreign control and ensuring long-term technological independence. As markets await the announcement, the global tech industry is bracing for potential disruptions and new tensions in the international trade landscape.

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