One of the biggest players in the chip industry isn’t ruling out knock-on effects from potential Trump tariffs on semiconductors.
“I do think that there could be some short-term impacts,” AMD (AMD) CEO Lisa Su told me in a Yahoo Finance exclusive on Monday. “I think it’s too early to say what the longer-term impacts are. I think we have to look at how things play out over the next number of months.”
AMD derives 66% of its sales internationally. Its cutting-edge chips are manufactured by behemoth Taiwan Semiconductor (TSM). Tariffs could raise the cost of production for AMD and its competitors and likely bleed through to end products such as PCs.
Where Trump ultimately lands on tariffs is up in the air.
Read more: What Trump’s tariffs mean for the economy and your wallet
Trump told reporters on Sunday aboard Air Force One that his much-anticipated tariff announcement on April 2 would “start” with all countries. Markets had expected a more targeted tariff approach.
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Trump has floated a 15% universal tariff.
But a month ago, he suggested he could slap tariffs of 25% on semiconductors. The decision could deal a blow to the likes of Taiwan Semiconductor, which recently committed to investing $100 billion in US chip manufacturing.
“If you look at the baseline, the baseline is we do want a more resilient supply chain. Resilient supply chains are important for every industry. They’re especially important for the semiconductor industry. We are big supporters of US manufacturing,” Su said.
Despite the tariff uncertainty, Su isn’t waiting to invest in her business.
AMD announced today it closed on its $4.9 billion acquisition of ZT Systems. Announced in August 2024, the deal is expected to bolster AMD’s presence in compute infrastructure for hyperscalers. ZT Systems counts Microsoft (MSFT) as a key customer, as does AMD.
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The company anticipates the transaction to be accretive to non-GAAP results by the end of 2025. The company is “actively engaged” with strategic partners to purchase ZT Systems’ US-based data center infrastructure manufacturing business in 2025.
Su says a decision on the manufacturing business will be shared in “coming months.”
Added Su, “I want to be really clear about this: There is no question we are in the very early innings of AI now, to put some of the noise aside. We continue to see is more applications, more capability. Enterprises are just at the very early innings of adoption. And frankly, they need more help from folks like ourselves.”
