Chip stocks jumped on Thursday after President Donald Trump said semiconductor companies would be exempt from tariffs if they invested in chip manufacturing in the U.S. But those that don't will face 100% tariffs.
Taiwan Semiconductor Manufacturing, the world's largest contract chipmaker, saw its U.S. shares rise 4.9% to close at 242.62 on the stock market today. It will be exempt from tariffs because it is building new chip factories in Arizona.
U.S.-based chipmakers helped by the news include GlobalFoundries and Texas Instruments.
"100% tariff on all chips and semiconductors coming into the United States," Trump said. "But if you've made a commitment to build (in the U.S.) or if you're in the process of building (in the U.S.), there is no tariff. … If you say you've committed but don't build, we'll add up the charges."
Trump made his comments on the Section 232 semiconductor tariffs at an event late Wednesday at the White House. At that event, consumer electronics giant Apple announced an additional $100 billion commitment to U.S. manufacturing. All told, Apple has pledged to invest $600 billion in U.S. operations over the next four years.
In its official announcement, Apple called out manufacturing partners Amkor Technology, Applied Materials, Broadcom, Coherent, Corning, GlobalFoundries, Samsung, Texas Instruments, TSMC and others.
Chip Stocks Get A Bump
The Philadelphia semiconductor index, known as SOX, rose 1.5% on Thursday. The SOX includes the 30 largest semiconductor stocks traded in the U.S., such as AMD, Broadcom and Nvidia. Year to date, the SOX index is up 13.1%.
The iShares Semiconductor ETF advanced 1.7% on Thursday. The exchange traded fund aims to match the performance of the NYSE Semiconductor Index.
Trump's chip tariff comments are "a relief" for semiconductor firms, Morgan Stanley analyst Joseph Moore said in a client note. Plus, reshoring chip manufacturing to the U.S. would provide a tailwind to makers of semiconductor manufacturing equipment, he said.
Intel Stock Falls On CEO Criticism
One chip stock falling on Thursday was Intel.
In a Truth Social post, President Trump urged Intel's chief executive, Lip-Bu Tan, to resign, calling him "highly conflicted."
Earlier this week, U.S. Sen. Tom Cotton, R-Ark., questioned Tan's ties to Chinese companies in a letter to Intel Chairman Frank Yeary. He noted that Tan, the former CEO at Cadence Design Systems, had invested in Chinese semiconductor companies and others with connections to the country's military.
"Intel and Mr. Tan are deeply committed to the national security of the United States and the integrity of our role in the U.S. defense ecosystem," the company said in a statement to Bloomberg. Intel said it would address the matters in the letter with the senator. The company appointed Tan as CEO in March.
On Thursday, Intel stock sank 3.1% to close at 19.77.
Bernstein analyst Stacy Rasgon said Tan's connections to Chinese companies were well known before he took the Intel job. In a client note, he said Tan is "a legend in the semi industry."
Tan took the Intel job because he has "a deep-seated passion for Intel and a desire to fundamentally reinvent an industry icon," Rasgon said. "He clearly wants to do what is best for Intel, and we suppose now he will have to ask himself whether or not resigning would best for them, especially with Trump's crosshairs on his back."
Some analysts have speculated that TSMC or Broadcom could take over all or parts of Intel.
Follow Patrick Seitz on X at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
