U.S. Analog Semi Industry Faces Tariff Risks, Bernstein Analysis

Bernstein estimates the US has 18% of global analog semiconductor capacity, enough to meet domestic demand, and only 4% of global discrete capacity. US-based suppliers such as Texas Instruments and Analog Devices are well-positioned to meet domestic needs, while non-US suppliers like Infineon and Renesas face exposure risks due to their limited US production footprint. However, Bernstein concludes that the impact of tariffs should be manageable for both US and non-US suppliers.

Analog Devices (ADI) and Texas Instruments (TI) are well-positioned to meet domestic semiconductor needs in the United States, according to recent reports. Bernstein estimates that the US has 18% of global analog semiconductor capacity, enough to meet domestic demand [1]. This is crucial for the US-based suppliers like ADI and TI, which are well-equipped to handle the domestic semiconductor market.

Meanwhile, non-US suppliers such as Infineon and Renesas face exposure risks due to their limited US production footprint. However, Bernstein concludes that the impact of tariffs should be manageable for both US and non-US suppliers. This is a significant development, as it indicates that the US semiconductor industry can rely on its domestic capabilities to a large extent, reducing dependency on foreign suppliers.

The recent performance of Analog Devices (ADI) underscores its strong position in the market. ADI ended the recent trading session at $237.65, demonstrating a +2.42% change from the preceding day's closing price [1]. This performance is notable as it outpaced the S&P 500's daily gain of 0.32%. The company is expected to report earnings of $1.93 per share on August 20, 2025, representing year-over-year growth of 22.15% [1].

In contrast, the semiconductor industry is also witnessing significant growth in India, with the Union Cabinet approving four new semiconductor manufacturing projects under the India Semiconductor Mission (ISM) [2]. These projects are expected to bolster India's chip-making ecosystem and position it as a key hub in the global chip supply chain. The projects include a compound semiconductor fabrication facility, an advanced packaging hub, a semiconductor manufacturing unit, and an expansion of a discrete semiconductor manufacturing facility.

Micron Technology (MU) is also performing well, with a significant increase in trading volume and positive analyst outlooks. On August 15, 2025, Micron's trading volume surged 51.16% to $2.3 billion, ranking 28th in market activity despite a 3.53% stock decline [3]. Analysts maintain bullish outlooks on Micron’s AI-driven HBM3E growth, with TD Cowen upgrading price targets to $150 [3].

In conclusion, the US semiconductor industry is well-positioned to meet domestic needs, with significant capacity and strong performance from key players like ADI and TI. Meanwhile, the global semiconductor landscape is evolving, with India and other countries investing in semiconductor manufacturing to strengthen their domestic ecosystems. The impact of tariffs is expected to be manageable for both US and non-US suppliers, indicating a robust and resilient semiconductor industry.

References:
[1] https://finance.yahoo.com/news/analog-devices-adi-outpaces-stock-220001153.html
[2] https://khabarindia.in/india-approves-four-new-semiconductor-projects-to-boost-atmanirbhar-bharat/
[3] https://www.ainvest.com/news/micron-trading-volume-surges-51-2-3-billion-ranking-28th-ai-demand-drives-optimism-2508/