The semiconductor giant is afraid to be hit hard! Trump's new tariffs may cause US chip equipment companies to lose more than 1 billion US dollars a year

The Zhitong Finance App learned that according to two people familiar with the matter, the new round of tariff policies proposed by US President Trump may cause US semiconductor equipment manufacturers to lose more than 1 billion US dollars a year. The estimate was made after discussions with government officials and members of Congress in Washington last week, and the associated costs were disclosed for the first time.

According to reports, the three major US semiconductor equipment manufacturers, Applied Materials (AMAT.US), Fanlin Group (LRCX.US), and KLAC.US (KLAC.US), may each lose about 350 million US dollars as a result. Additionally, smaller competitors, such as Onto Innovation, are also under pressure to spend tens of millions of dollars.

Chip equipment manufactured by these companies is in high demand worldwide, and usually requires thousands of highly specialized components. Currently, they have lost billions of dollars in revenue due to a series of export controls imposed by former President Joe Biden. The Biden administration aims to limit the flow of advanced chip-making equipment into China.

The reciprocal tariffs announced by the Trump administration in April of this year have basically been suspended, but in order to promote the development of the local manufacturing industry, it is considering imposing further tariffs on the semiconductor industry and launched a related import investigation this Monday.

Allegedly, this estimated cost of up to 1 billion US dollars includes several aspects: first, loss of revenue due to loss of middle- and low-end equipment sales to overseas customers; second, manpower and time costs required to find replacement suppliers; and third, staffing and administrative expenses due to complying with complex tariff compliance regulations.

These estimates are still preliminary rough calculations, because each chip device consists of multiple components, and the specific tariff policy is not yet clear, making it difficult for companies to quickly estimate the actual impact. Washington is continuing communication and dialogue with chip industry executives and representatives of the Global Semiconductor Industry Association (SEMI).

It is worth noting that under the pressure of US export restrictions, China has stepped up the pace of investment in the local semiconductor equipment industry in an effort to reduce its dependence on the US and achieve technological autonomy.

Meanwhile, chip giant Nvidia (NVDA.US) said on Tuesday that its first-quarter earnings report will include about $5.5 billion in expenses related to its H20 products. This H20 chip is currently the only product that Nvidia has been allowed to legally sell to China by the US government. This cost involved inventory, procurement commitments and related reserves. After the news was released, Nvidia's stock price fell by more than 4.5% in after-hours trading.