Most Read – China and ASML, Intel’s 18A, IBM closing R&D

Let’s take them in reverse order…

5. IBM closes China R&D operations
After 25 years of operation IBM is to close its R&D units in China. The units, called the China Development Lab (CDL) and China Systems Lab (CSL), were set up in 1999. Closing them will involve the loss of 1,000 jobs. IBM’s sales in China fell 19.3% last year. The China government has been implementing a policy called ‘Delete America’ or ‘Delete A’ set out in ‘Document 79’, which instructs Chinese companies to replace foreign software with local alternatives by 2027.

4. China out-spending Taiwan, Korea, US combined on chip manufacturing equipment
China spent more on semiconductor manufacturing equipment in H1 – $25 billion – than Korea, Taiwan and the U.S. combined, reports the Nikkei. China was the only country to increase spending on chip equipment in H1 with the US, Korea and Taiwan all reducing it. Apart from renewed demand and higher ASPs for memory, plus the surge in demand for AI chips, most semiconductor product segments have seen growth of only 3-5%.

3. US semi sales overtake China semi sales
For the first time in over five years, chip sales in America have overtaken chip sales in China with US July sales of $15.4 billion and China July sales of $15.2 billion. Globally, July chip sales of $51.3 billion were up 18.7% on the July 2003 sales figure of $43.2 billion and up 2.7% on the June 2024 total of $50 billion, says the SIA. “The global semiconductor market continued to grow substantially on a year-to-year basis in July, and month-to-month sales increased for the fourth consecutive month,” says SIA CEO John Neuffer.

2. Broadcom reported to decide that Intel 18A not yet ready for volume production
Intel’s 18A has been found wanting by Broadcom after it ran test wafers on the process, reports Reuters. According to the report, Broadcom got the wafers back from Intel last month and decided that the process was not yet viable for high volume production. “Intel 18A is powered on, healthy and yielding well, and we remain fully on track to begin high volume manufacturing next year,” an Intel spokesperson told Reuters.

1. China threatens ASML
A China state-controlled news site – the Global Times – has threatened ASML with long-term exclusion from the Chinese market if it complies with US restrictions on selling spares and maintaining machines already sold to Chinese chip companies. “If the Netherlands follows this strategy, it will exacerbate the widening rift in China-US and China-Netherlands relations,“ said the Global Times earlier this week, adding “if ASML loses the Chinese market, it will suffer significant economic losses. This loss could potentially lead to a decrease in ASML’s global market share…”