What are semiconductor tariffs and how do they work?

Semiconductor tariffs are taxes imposed on imported computer chips and related components. The Trump administration's tariffs are designed to make foreign chips more expensive, encouraging companies to buy from domestic manufacturers instead and incentivising foreign companies to move production to the US.

What does 'onshoring' mean in the semiconductor industry?

Onshoring refers to bringing manufacturing operations back to the home country, in this case the United States. For semiconductors, it means building chip factories and production facilities domestically rather than relying on overseas manufacturing, which can improve supply chain security and create local jobs.

How might these tariffs affect semiconductor stock prices?

Tariffs could benefit US-based semiconductor companies by reducing foreign competition and potentially increasing demand for their products. However, they might also increase costs for companies that rely on imported chips, creating both winners and losers in the market depending on each company's business model.

What is the semiconductor supply chain?

The semiconductor supply chain includes all the companies involved in making computer chips - from the manufacturers who design and produce the chips, to the equipment makers who build the machinery, to the materials suppliers who provide the raw components. This group includes companies across this entire value chain.

What does 'analyst rating' mean for stocks?

An analyst rating is a professional recommendation from financial experts about whether to buy, hold, or sell a stock. Ratings typically range from 'strong buy' to 'strong sell' and are based on the analyst's research into the company's financial health, market position, and growth prospects.

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US Semiconductor Theme (Tariff Opportunity) Gains Focus

The Trump administration has announced significant tariffs on semiconductor imports to encourage domestic production. This policy shift creates a potential tailwind for U.S.-based chip manufacturers and companies within the domestic supply chain.

Han Tan | Market Analyst

Updated today | Published at September 5