Computer-chip Manufacturing

[phkrause]

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.