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If China moves on Taiwan AMD will go to nearly zero. If you're invested in AMD, either via equities or employment, make sure to hedge your position. Edit: Cur

If China moves on Taiwan AMD will go to nearly zero. If you're invested in AMD, either via equities or employment, make sure to hedge your position. Edit: Curious if the downvotes are because you think AMD doesn't need TSMC, because you think China will absolutely never invade Taiwan, or if you think AMD can find another fab within a year or two.

amelius 5y ago
After recent events, that will not happen.
- vkou 5y ago
  Sanctioning Russia is easy for the West. Sanctioning China is a non-starter.
  - exdsq 5y ago
    Maybe, but Taiwan has a treaty with the US and other countries meaning it’d escalate out of the gate. Ukraine, sadly, had none.
    - jlmorton 5y ago
      Taiwan does not have any treaties with the United States, because the United States does not recognize Taiwan as a country, or have normal diplomatic relations with Taiwan, ever since the Taiwan Relations Act of 1979. The US _did_ have a mutual defense treaty with Taiwan, but it was terminated by the Taiwan Relations Act after the US initiated diplomatic relations with the People's Republic of China on Jan 1st, 1979.
  - deleted 5y ago
    [deleted]
  - _8j50 5y ago
    Disagree. War with China is worse than sanctioning China. Abandoning Taiwan means deatabilizing the region (Japan militarizes, China opposes Japan. NK does whatever they want. South china see conflict leads to vietnam,philipines joining,etc...). China is very important but the shipping lanes to SE asia and regional stability is more valuable. You can sanction China and get in a sanction war with them until one side gives in. Or a trade war like trump tried. Their focus however is to win the war before it starts unlike the US which is to win the war after it starts (imo). If it gets to a full in sanction like russia, the western economy will tak a massive hit, but it isn' beyond recovery and might actually be good to force resilent supply chains. Especially with silicon fab.
    - 01100011 5y ago
      > force resilent supply chains How many years do you think it would take to build up those resilient supply chains? 5 years? That's 5 years without most products from AMD, Nvidia, Tesla and every other TSMC customer. Samsung can absorb some of that business, but not much. Intel will shoot to the moon in that scenario.
      - _8j50 5y ago
        TSMC is already planning multiple factories in the US, India,etc... So is Intel. Raw materials are what are most concerning. Either way, it would be bad for the economy but war is profitable and war time powers can bend a lot of rules/companies.
        colinmhayes 5y ago
        The vast majority of TSMC manufacturing will still be in Taiwan. The US fabs are mostly for national defense products that legally need to be completely domestically sourced from what I can tell.
    - vkou 5y ago
      War with China is worse than sanctioning China, but likewise, war with Russia is worse than sanctioning Russia. There's a reason why NATO is content to stand by and do nothing. I can't tell you what will happen if Taiwan is invaded tomorrow, next year, or twenty years from now, but I can tell you that the US will think long and hard about whether or not it will want to get involved. And it might well choose not to.
sesteel 5y ago
It seems like TSMC building a US based foundry may become a mitigating factor.
- 01100011 5y ago
  That plant is two years away at least.
  - bredren 5y ago
    What are the implications of this plant if it is spun up successfully on a two year timeline? What planned or potential pipeline of other new non-Intel chip fabrication plants on US soil do you foresee?
    - 01100011 5y ago
      Looks like someone else already answered this better than I could have.
- bradleyjg 5y ago
  I’m skeptical of that. Yes, TSMC will have a plant or two left but a) AMD isn’t going to be first on line for whatever of the diminished capacity is left and b) I have to imagine it’ll be at least disruptive to operations to have the rest of the company disappear.
- haukem 5y ago
  The $12B Fab which TSMC builds in Phoenix, will be outdated when it will open in 2024 and it is too small for AMD or Apple. It is likely it is mainly build to secure chip supply for the US military in case China invades Taiwan and the US does not have access to the TSMC Fabs in Taiwan any more. Apple and AMD will probably not be able to sell products for 1 year till they migrated to Intel or Samsung production in case TSMC fabs in Taiwan are not available for them any more. The TSMC fab in Phoenix is build for 5nm and will open in 2024. The TSMC 3nm process should go into mass production in 2023, it is expected that the 2023 iPhone will use a 3nm SoC. The fab will only produce 20k Wafers per month, the TSMC gigafabs in Taiwan produce 100k Wafer per month each. Details about TSMC Phoenix fab: https://www.cnbc.com/2021/10/16/tsmc-taiwanese-chipmaker-ramping-production-to-end-chip-shortage.html https://www.cnbc.com/2021/10/16/tsmc-taiwanese-chipmaker-ram...
clove 5y ago
I didn't downvote you, but (1) TSMC is building fabs in both the US (Arizona) and Japan (Kumamoto). (2) China is unlikely to invade Taiwan anytime soon; the country is working on more of a diplomatic takeover a la Hong Kong. (3) I don't know any reasonable argument for AMD not needing TSMC.
- willbudd 5y ago
  OK, I'll bite. What is this "diplomatic takeover" of Taiwan you speak of? The historical circumstances of HK and Taiwan are nothing alike. Furthermore, the mainland communist party doesn't have any sway on Taiwanese politics, as far as I can tell ...other than as a common nemesis to unite against in relation to any issues that could affect the island's autonomy.
  - coredog64 5y ago
    Taiwan has a subgroup of the population that wants peaceful reintegration with the mainland. They’ve dropped in numbers following the situation in HK, but they do still exist.
    - willbudd 5y ago
      Peaceful coexistence? Sure. Closer coordination and cooperation in a socioeconomic context? Also on the table. But _integration_ with the communist PRC? Uhmm... yeah no, that's a pretty disingenuous characterization of the KMT side of Taiwanese politics.
      - clove 5y ago
        It's not KMT but a different group. Those who want reunification exist and often hold powerful positions. China wants more of these people and are actively employing soft power in Taiwan to convert more to their side. I'm not sure what the intended time frame for success is, but China is in this for the long-haul. Perhaps if things goes China's way, the PRC can strike a deal with the KMT for some sort of local governance, likely along with a name and flag change - or a third party could rise up and supplant KMT. Of course, either situation would kill off the DPP.
systemBuilder 5y ago
Not exactly true AMD is still doing a little bit of manufacturing at Global Foundries but that place threw up their hands in the air and quit innovating! So stuck at 10-12nm ...
amunicio 5y ago
The same could be said about Apple. All their chips are made by TSMC.

amelius 5y ago

After recent events, that will not happen.

vkou 5y ago
Sanctioning Russia is easy for the West. Sanctioning China is a non-starter.
- exdsq 5y ago
  Maybe, but Taiwan has a treaty with the US and other countries meaning it’d escalate out of the gate. Ukraine, sadly, had none.
  - jlmorton 5y ago
    Taiwan does not have any treaties with the United States, because the United States does not recognize Taiwan as a country, or have normal diplomatic relations with Taiwan, ever since the Taiwan Relations Act of 1979. The US _did_ have a mutual defense treaty with Taiwan, but it was terminated by the Taiwan Relations Act after the US initiated diplomatic relations with the People's Republic of China on Jan 1st, 1979.
- deleted 5y ago
  [deleted]
- _8j50 5y ago
  Disagree. War with China is worse than sanctioning China. Abandoning Taiwan means deatabilizing the region (Japan militarizes, China opposes Japan. NK does whatever they want. South china see conflict leads to vietnam,philipines joining,etc...). China is very important but the shipping lanes to SE asia and regional stability is more valuable. You can sanction China and get in a sanction war with them until one side gives in. Or a trade war like trump tried. Their focus however is to win the war before it starts unlike the US which is to win the war after it starts (imo). If it gets to a full in sanction like russia, the western economy will tak a massive hit, but it isn' beyond recovery and might actually be good to force resilent supply chains. Especially with silicon fab.
  - 01100011 5y ago
    > force resilent supply chains How many years do you think it would take to build up those resilient supply chains? 5 years? That's 5 years without most products from AMD, Nvidia, Tesla and every other TSMC customer. Samsung can absorb some of that business, but not much. Intel will shoot to the moon in that scenario.
    - _8j50 5y ago
      TSMC is already planning multiple factories in the US, India,etc... So is Intel. Raw materials are what are most concerning. Either way, it would be bad for the economy but war is profitable and war time powers can bend a lot of rules/companies.
      - colinmhayes 5y ago
        The vast majority of TSMC manufacturing will still be in Taiwan. The US fabs are mostly for national defense products that legally need to be completely domestically sourced from what I can tell.
  - vkou 5y ago
    War with China is worse than sanctioning China, but likewise, war with Russia is worse than sanctioning Russia. There's a reason why NATO is content to stand by and do nothing. I can't tell you what will happen if Taiwan is invaded tomorrow, next year, or twenty years from now, but I can tell you that the US will think long and hard about whether or not it will want to get involved. And it might well choose not to.

sesteel 5y ago

It seems like TSMC building a US based foundry may become a mitigating factor.

01100011 5y ago
That plant is two years away at least.
- bredren 5y ago
  What are the implications of this plant if it is spun up successfully on a two year timeline? What planned or potential pipeline of other new non-Intel chip fabrication plants on US soil do you foresee?
  - 01100011 5y ago
    Looks like someone else already answered this better than I could have.
bradleyjg 5y ago
I’m skeptical of that. Yes, TSMC will have a plant or two left but a) AMD isn’t going to be first on line for whatever of the diminished capacity is left and b) I have to imagine it’ll be at least disruptive to operations to have the rest of the company disappear.
haukem 5y ago
The $12B Fab which TSMC builds in Phoenix, will be outdated when it will open in 2024 and it is too small for AMD or Apple. It is likely it is mainly build to secure chip supply for the US military in case China invades Taiwan and the US does not have access to the TSMC Fabs in Taiwan any more. Apple and AMD will probably not be able to sell products for 1 year till they migrated to Intel or Samsung production in case TSMC fabs in Taiwan are not available for them any more. The TSMC fab in Phoenix is build for 5nm and will open in 2024. The TSMC 3nm process should go into mass production in 2023, it is expected that the 2023 iPhone will use a 3nm SoC. The fab will only produce 20k Wafers per month, the TSMC gigafabs in Taiwan produce 100k Wafer per month each. Details about TSMC Phoenix fab: https://www.cnbc.com/2021/10/16/tsmc-taiwanese-chipmaker-ramping-production-to-end-chip-shortage.html https://www.cnbc.com/2021/10/16/tsmc-taiwanese-chipmaker-ram...

clove 5y ago

I didn't downvote you, but (1) TSMC is building fabs in both the US (Arizona) and Japan (Kumamoto). (2) China is unlikely to invade Taiwan anytime soon; the country is working on more of a diplomatic takeover a la Hong Kong. (3) I don't know any reasonable argument for AMD not needing TSMC.

willbudd 5y ago
OK, I'll bite. What is this "diplomatic takeover" of Taiwan you speak of? The historical circumstances of HK and Taiwan are nothing alike. Furthermore, the mainland communist party doesn't have any sway on Taiwanese politics, as far as I can tell ...other than as a common nemesis to unite against in relation to any issues that could affect the island's autonomy.
- coredog64 5y ago
  Taiwan has a subgroup of the population that wants peaceful reintegration with the mainland. They’ve dropped in numbers following the situation in HK, but they do still exist.
  - willbudd 5y ago
    Peaceful coexistence? Sure. Closer coordination and cooperation in a socioeconomic context? Also on the table. But _integration_ with the communist PRC? Uhmm... yeah no, that's a pretty disingenuous characterization of the KMT side of Taiwanese politics.
    - clove 5y ago
      It's not KMT but a different group. Those who want reunification exist and often hold powerful positions. China wants more of these people and are actively employing soft power in Taiwan to convert more to their side. I'm not sure what the intended time frame for success is, but China is in this for the long-haul. Perhaps if things goes China's way, the PRC can strike a deal with the KMT for some sort of local governance, likely along with a name and flag change - or a third party could rise up and supplant KMT. Of course, either situation would kill off the DPP.

systemBuilder 5y ago

Not exactly true AMD is still doing a little bit of manufacturing at Global Foundries but that place threw up their hands in the air and quit innovating! So stuck at 10-12nm ...

amunicio 5y ago

The same could be said about Apple. All their chips are made by TSMC.