China May Investigate Intel in Response to U.S. Tariffs
Concerns Rise Over Ripple Effects on TSMC and Alchip Orders
Intel at Risk as 29% of Revenue Depends on China
Concerns have been raised that Taiwanese IT companies, which count major U.S. big tech firms as clients, could also be affected as China retaliates against the U.S. tariff policy on China by sanctioning large American IT companies. In particular, if Intel, a major player in the semiconductor supply chain, becomes the subject of an official investigation, companies with large order volumes such as TSMC are also expected to be inevitably impacted.
On the 6th, Taiwanese local media Economic Daily News (EDN) reported, "If Intel's product shipments in China are blocked, Taiwanese listed companies such as TSMC and Alchip Technologies, which have recently secured many foundry orders for Intel's central processing units (CPUs), are also expected to be affected."
It added, "Intel is one of TSMC's advanced process customers, and the market is closely monitoring related order situations. Intel was scheduled to become a major artificial intelligence (AI) chip customer for Alchip this year, so there is growing interest in whether there will be any changes to related orders."
These concerns surfaced as the Chinese government, which is currently investigating Google, a leading U.S. big tech company, for antitrust violations, is speculated to include Intel in its investigation. Earlier, the UK Financial Times (FT) cited anonymous sources reporting that China's State Administration for Market Regulation is considering launching an official investigation into Intel.
Intel has not issued an official statement, but it is known to have generated $15.5 billion (approximately 22.5 trillion KRW) in sales in China alone last year. This accounts for 29% of its global revenue, exceeding sales in the U.S. mainland market. The high dependence on China is pointed out as a factor that increases the likelihood of becoming a target of Chinese authorities.
Intel has repeatedly been mentioned amid crisis talks due to its poor performance. Its stock price plummeted by 52% last year due to weak earnings. According to U.S. CNBC, CEO Pat Gelsinger was dismissed effective December 1 last year by board resolution, taking responsibility for losing ground to Nvidia and the failure of a large-scale investment plan involving $20 billion.
Taiwanese IT manufacturers have already experienced some supply chain impacts during their cooperation with Intel last year. Some new collaborative projects were also delayed. Regarding this, EDN noted, "If China actually takes measures targeting Intel, such supply chain shocks could continue into this year."
However, unlike Google and Nvidia, Intel is not yet at a confirmed stage of investigation by the Chinese government. An anonymous source told FT, "The nature of the investigation into Intel is still unclear, and whether the investigation will commence may also be influenced by U.S.-China relations."
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