Computer-chip Manufacturing

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Everything is chips now

Illustration: Annelise Capossela/Axios Semiconductors — also called chips — are the new It Girl of the global economy, Axios' Emily Peck writes. Chips are essential to the AI boom. That's driving huge demand, creating supply shortages, pushing up prices and creating an investment frenzy. It also puts chips at the center of the geopolitical table. ✈️ Case in point: Nvidia CEO Jensen Huang boarded Air Force One last night during a refueling stop in Anchorage, joining President Trump's CEO-packed China trip. Trump called Huang and invited him after media reports that the chip mogul wasn't included in the summit's big CEO delegation, a source tells Axios. 📈 The stock market is now largely a chips story too. Since ChatGPT launched in 2022, the PHLX semiconductor index — which tracks 30 of the industry's biggest firms — has grown to account for 16% of the S&P 500's market cap. That's up from 4%. 🧐 It's hard to overemphasize how weird the chip market is right now. Outside of the pandemic, when supply issues drove up costs, the price of computing power has typically trended down. Now, frenzied demand for "compute" to power AI has driven up prices throughout the chip supply chain. 🌏 Geopolitics hang over all of this, as Trump's meeting with Chinese leader Xi Jinping this week casts a spotlight on the global chips trade. The U.S. dominates in advanced AI compute that sits at the top of the stack. But China owns the bottom — it has the critical minerals and the more basic foundational chips. 🇺🇸 🇨🇳 In other words, they need each other. Go deeper.

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Nvidia's robot referee

Humanoid robots on display at the Nvidia booth during the Supply Chain Expo in China yesterday. Photo: Johannes Neudecker/picture alliance via Getty Images Nvidia rolled out what it calls a "comprehensive safety system" — called Halos for Robotics — for humanoid robots designed to ensure that they can be deployed alongside humans, Axios' Nathan Bomey writes. The system incorporates software, processing power, sensors and inspection capability drawn from the company's work on autonomous vehicles. Read the announcement ...

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🌶️ OpenAI fires up "Jalapeño" chip

Illustration: Brendan Lynch/Axios OpenAI has begun testing "Jalapeño," the first in a family of homegrown computer chips, Axios' Ina Fried reports. It plans to start using the chips to handle customers' AI queries later this year. Broadcom helped with the development. 🤖 OpenAI joins other leading AI companies in designing its own silicon as it races to secure more computing capacity, lower its costs and reduce its dependence on chipmaker Nvidia. Broadcom CEO Hock Tan delivers a chip wafer to OpenAI CEO Sam Altman. Photo: OpenAI 🔋 OpenAI says its chips offer better efficiency and performance per watt of electricity compared to off-the-shelf options. Richard Ho, who leads the company's chip effort, tells Axios: "This gives OpenAI full stack control." Go deeper.

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📱 Memory chip squeeze

Data: FactSet. Chart: Matt Phillips/Axios Memory chip makers are raking in record profits with no end in sight. You'll see it in the price of your next phone or laptop, Axios Markets co-author Matt Phillips writes. Why it matters: Shares of Micron Technology, Sandisk and the like have helped carry the market over the last year, as seemingly inexhaustible demand from the AI boom pushed profitability to unprecedented levels. 🔬 Zoom in: Prices for DRAM memory chips used in PCs and servers were up roughly 660% in the year through June, according to data from Bernstein Research. Benchmark prices for broadly used NAND flash memory — which allows devices to retain data when powered off — are also up 660% over the last year. Apple has blamed surging memory costs for its recent price increases. 🇨🇳 Between the lines: Bernstein's Mark Newman warned that desperate buyers may push the government to loosen restrictions on cheaper Chinese memory chips — some from companies currently blacklisted by the Pentagon.