In Short:
– AI’s growth drives higher semiconductor demand across sectors like data centres and consumer electronics.
– Supply chain challenges arise, influenced by smart cities, healthtech, and government initiatives like the CHIPS Act.

AI is reshaping various industries, significantly increasing demand for semiconductors essential for applications ranging from data centres to consumer electronics. According to The Guardian, this surge pushes companies like Meta, Google, Microsoft, and Amazon further along their adoption curves.

The chip supply chain faces notable challenges, particularly in areas beyond training and inference. Current market pressures are prompting a reevaluation of how AI impacts demand in sectors like automotive and consumer goods.

Chip Demand

Factors influencing this increased demand include the rise of smart cities and advancements in healthtech and robotics. Government initiatives, such as the CHIPS Act, play a crucial role in defining supply-chain dynamics.

Companies expected to thrive in this environment include NVIDIA, AMD, and Broadcom. Additionally, investors are advised to keep an eye on emerging firms like Allegro MicroSystems and Axcelis Technologies.