Weekly News Issue #192
Semiconductor Industry Supply Chain Dynamics
01
Corporate News (November 17)
GlobalFoundries Strategically Acquires AMF, Aiming to Become the World’s Largest Pure Silicon Photonics Foundry
On November 17, GlobalFoundries announced the acquisition of Advanced Micro Foundry (AMF), a silicon photonics wafer foundry based in Singapore, with the amount undisclosed. After the transaction is completed, GlobalFoundries will integrate AMF’s 200mm production line, 15 years of silicon photonics IP, and customer resources, making it the world’s largest “pure” silicon photonics foundry by revenue. The company will also immediately initiate a 300mm upgrade, with production capabilities in both New York and Singapore, providing pluggable transceivers and co-packaged optical devices for AI data centers and LiDAR. A new Singapore Silicon Photonics Excellence Center will be established in collaboration with A*STAR to develop a 400Gbps ultra-high-speed transmission platform, aiming for over $1 billion in annual revenue from silicon photonics by 2030.
Commentary:
GlobalFoundries is strategically filling its silicon photonics foundry gap with AMF, precisely positioning itself for the AI computing and CPO explosion window: it has a CMOS-compatible process to secure orders from North American cloud giants while using its Singapore base to mitigate geopolitical risks. The silicon photonics market is expected to double in five years, and the early expansion of capacity and ASP will significantly improve the company’s gross margin. However, challenges lie ahead: TSMC and Samsung are accelerating 3D optoelectronic packaging, and domestic manufacturers may initiate a price war; the 400Gbps standard is not yet established, and customer validation cycles are long. GlobalFoundries needs to quickly improve AMF’s yield to over 95% and open up the PDK ecosystem to convert scale advantages into long-term barriers.
02
Corporate News (November 18)
TSMC’s U.S. Plant Sees Dramatic Drop, Suffering Heavy Losses!
On November 18, TSMC’s financial report revealed that its Arizona subsidiary’s Q3 net profit was only NT$41 million, a staggering 99% drop from NT$42.32 billion in Q2, causing market shockwaves. Although Fab 21’s first phase has begun mass production of 4nm and secured large orders from Apple and NVIDIA, the simultaneous introduction of 3/2nm in the second phase has led to concentrated depreciation of equipment, high labor, and electricity costs, resulting in a more than 40% surge in quarterly operating expenses, consuming nearly all profits. The estimated loss for the entire year of 2024 is NT$14.3 billion, with cumulative losses nearing NT$40 billion over four years, making it TSMC’s most costly overseas project.
Commentary:
The allure of “Made in America” cannot counter the reality of costs: TSMC’s profits evaporated in the U.S., highlighting three major drawbacks of moving high-end processes abroad—doubling capital expenditures, low blue-collar efficiency, and energy and infrastructure premiums. In the short term, to fulfill customer commitments and CHIPS subsidies, TSMC must grit its teeth to complete 3nm mass production by 2026, with depreciation pressure continuing to drag down the group’s gross margin. In the medium term, if the U.S. does not provide additional subsidies or escalates tariffs against China, the Arizona plant may become a “strategic burden,” forcing TSMC to slow down subsequent 2nm expansions and keep more advanced nodes in Hsinchu and Kaohsiung, balancing profitability and risk. This harsh reality serves as a wake-up call for the island’s “relying on the U.S. to protect Taiwan” narrative: it is difficult to achieve a balance among technology, cost, and geopolitics, and core production capacity must remain rooted in the most efficient bases.
03
Policy News (November 19)
The Netherlands Returns Control of Nexperia
On November 19, Dutch Minister of Economic Affairs Karremans sent a letter to Parliament announcing the immediate suspension of the takeover order issued to Nexperia on September 30 under the “Commodity Availability Act,” fully restoring operational, personnel, and intellectual property decision-making authority to its Chinese parent company, Wingtech Technology. This move means the end of a 50-day “freeze” status, and Nexperia’s Chinese factory has resumed exports of critical automotive chips such as diodes and transistors to European and Asian customers, with the first batch of approximately 300 million packaged components shipped this week from Dongguan to alleviate the supply chain crisis that forced Honda and Volkswagen to cut production due to shortages.
The Hague stated that the lifting of the control is a “goodwill signal,” but still requires Nexperia to report in advance if it plans to transfer production resources or patents; the Dutch corporate court’s previous suspension of CEO Zhang Xuezheng’s position and the decision to place Wingtech’s shares in the custody of a third party remain effective, preserving legal leverage for future negotiations.
Commentary:
The Netherlands’ “return” of Nexperia appears to be a sharp turn, but in reality, it is a rational retreat calculated based on costs and electoral votes: the economic calculation—European automakers are approaching the Christmas production season, and Nexperia China accounts for half of its global packaging testing; a hard decoupling would mean daily losses of millions of dollars in halted operations, which the Dutch government cannot bear under industry pressure; the legal calculation—the corporate court still holds custody rights, and the Dutch side can freeze operations again at any time under the pretext of “technology leakage,” providing an explanation to domestic hawks while retaining negotiation leverage with China; the geopolitical calculation—the U.S. has postponed 50% of penetrating controls for a year, allowing the Netherlands to avoid being the “vanguard” and leaving room for maneuvering in the U.S.-China-Europe triangle.
For China, the restoration of shipments does not equate to a return of control; for Wingtech to truly regain governance rights, it still needs to challenge the legality of the “temporary custody” in the Dutch courts and prove that it will not hollow out European production lines. In the short term, the Nexperia incident reminds outbound enterprises that cross-border mergers and acquisitions must anticipate “political risk clauses,” with key IP and equipment stored in a distributed manner and establishing multi-domain backup production lines. In the long term, if the EU’s “Economic Security Review Regulation” is implemented in 2026, similar “Nexperia-style” raids may become normalized, and China’s semiconductor overseas layout will shift from “buying out” to “localization + minority equity,” binding the interests of the other party through joint ventures to reduce the probability of being completely frozen.
04
Policy News (November 20)
U.S. Approves AI Chip Exports
On November 20, Washington time, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) officially issued two batches of “advanced AI chip export licenses”:
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Issuing approximately 35,000 processors equivalent to NVIDIA’s GB300 computing power to the UAE’s G42 Group for training the “Falcon” large model in Abu Dhabi;
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Selling tens of thousands of AMD MI350 and NVIDIA H200 chips to Saudi Arabia’s Humain company to support its plan to deploy 400,000 AI chips by 2030 and build the largest intelligent computing center in the Gulf.
This approval comes with three “limits” conditions: 1) No resale or transfer to third parties; 2) Must submit quarterly computing power usage logs to BIS; 3) Data centers exceeding 10 MW must accept on-site inspections by the U.S. side. U.S. officials stated that this is part of Trump’s “chip diplomacy,” aimed at expanding the influence of U.S. AI standards in the Middle East in a controlled manner while balancing concerns from allies like Israel and the EU regarding computing power overflow. In the market, NVIDIA and AMD stocks rose 4.2% and 5.1% respectively after hours, and ASML also rose due to increased expectations for EUV demand.
Commentary:
Washington is maintaining high-pressure lines against China while opening green lights to Middle Eastern allies, highlighting its “layered control” approach:
For the first tier (Middle Eastern allies), it uses “quotas + audits” to exchange for market access, securing orders while exporting standards; for the second tier (Singapore, India, etc.), it continues to enforce a total cap of $790 million over three years; for the third tier (China, Russia, Iran), it maintains a comprehensive embargo, even requiring global cloud vendors not to use U.S. chips to train Chinese models.
The Gulf countries obtaining chips will accelerate the construction of regional intelligent computing hubs, potentially diverting AI project orders from Chinese companies in the Middle East; however, the accompanying data residency and audit clauses also mean that the model weights and training data of Middle Eastern governments and enterprises will be “one-way transparent” to the U.S., which may weaken their technological sovereignty in the long run. For China, the external high-end computing power gap is further widening, and the window for domestic GPU/ASIC alternatives is compressed to 1-2 years. Companies like Cambricon and Huawei Ascend must quickly break through the CUDA ecosystem and advanced packaging bottlenecks, or they will face a risk of computing power interruption in the latter half of the “hundred model war.”
05
Domestic News (November 18)
Siwei Electronics Plans to Invest in Lithography Machine Company Xindonglai
On the evening of November 18, Siwei Electronics announced plans to acquire no more than 11% of the shares of Beijing Xindonglai Semiconductor Technology Co., Ltd. from its original shareholders for no more than 60 million yuan. The latter was established in 2023, focusing on the remanufacturing of mature process lithography machines and self-developed complete machines, having launched its first I-line (300nm) projection stepper lithography machine, compatible with 4-8 inch silicon and SiC/GaN substrates, used for power devices, MEMS, and advanced packaging. After the transaction, Xindonglai will become a subsidiary of Siwei Electronics. The company stated that this move aims to improve the semiconductor equipment ecosystem, increase the proportion of domestic equipment, and reduce risks in the supply chain of critical equipment. However, the target company’s revenue for the first nine months was only 1.96 million yuan, with a net loss of 15.79 million yuan, and the assessed value increase was relatively high, leading board member Zhang Shuai to abstain from voting due to “uncertainty regarding subsequent capital increases and price fairness,” raising market concerns.
06
Domestic News (November 20)
Wei Shaojun’s Latest Report: Within 5 Years, China’s Chip Design Industry Will Exceed 1 Trillion!
On November 20, Wei Shaojun, chairman of the IC Design Branch of the China Semiconductor Industry Association, released a report titled “Technological Innovation Drives Design Industry Upgrades” at ICCAD-Expo 2025: By 2025, the sales revenue of China’s chip design industry is expected to reach 835.73 billion yuan, a year-on-year increase of 29.4%, with the number of companies increasing to 3,901 and 831 companies reaching the billion-yuan level; communication and consumer chips will account for 66.5%, while computer chips will only account for 7.7%. Driven by the explosive demand for AI and electric vehicles, Wei Shaojun predicts that the industry will maintain a compound growth rate of nearly 20%, with the overall scale exceeding 1 trillion yuan before 2030, becoming the largest design market in the world.
The “trillion” blueprint highlights China’s ambition to overtake in IC design: on the demand side, AI, automotive, and data centers are opening up new increments, while on the supply side, the Yangtze River Delta and Pearl River Delta ecosystems are gathering, with continuous influx of capital and talent. However, three major shortcomings remain: the low proportion of computer chips, dependence on EDA/IP, and limitations in advanced processes. In the next five years, whether breakthroughs can be made in Chiplet, RISC-V, and domestic EDA will determine whether the trillion scale is “inflated” or “muscular.” Policies need to focus on FinFET/FD-SOI tape-out, storage, and high-end MCU breakthroughs, and improve the “first round tape-out + insurance” mechanism to help companies cross the “valley of death” from laboratory to mass production.
07
Domestic News (November 20)
Jingsheng Electromechanical’s First 12-Inch Silicon Carbide Pilot Line Goes Live
According to reports from the Semiconductor Industry Network on November 20, Jingsheng Electromechanical revealed on its investor interaction platform that the company’s silicon carbide substrate material business has achieved large-scale production and sales of 6-8 inch silicon carbide substrates, with the core parameter indicators of mass-produced products reaching industry-leading levels. The 8-inch silicon carbide substrates are among the best in the country in terms of technology and scale.
Jingsheng Electromechanical stated that it is actively promoting customer validation of silicon carbide substrate products globally, with the number of sample customers significantly increasing compared to before, and product validation is progressing smoothly. Meanwhile, the company’s first 12-inch silicon carbide substrate processing pilot line has officially gone live, marking that Jingsheng Electromechanical has established a complete closed loop from 12-inch SiC substrate equipment to materials.
Editor | Hongming Digital Marketing Department
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