Impact of Iran War on Chip Supply Chains
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Should l Buy NVDA?
Source: NASDAQ.COM
- Helium Supply Crisis: The Iran war has damaged helium production infrastructure at Qatar's Ras Laffan Industrial City, forcing QatarEnergy to declare force majeure and halt operations, resulting in helium spot prices doubling in the following weeks, which directly impacts the cost and supply of global semiconductor manufacturing.
- Pressure on Chipmakers: Samsung and SK Hynix, which produce two-thirds of the world's memory chips, are heavily reliant on helium, and disruptions in helium supply have led to rising industrial electricity prices in South Korea, affecting companies like Nvidia and Microsoft that depend on high-bandwidth memory.
- Micron Technology Risks: Micron's production processes are also helium-dependent, and if global supply tightens, its domestic production cannot provide adequate insulation; Morningstar warns that if the helium issues in Qatar persist through summer, Micron's margins could compress significantly.
- TSMC Vulnerability: Taiwan Semiconductor Manufacturing, which produces Nvidia's most advanced AI chips, imports 97.7% of its energy, and if helium and energy constraints last for six months, its industrial production could fall by 0.7%, highlighting its vulnerability in the supply chain.
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Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise
41 Analyst Rating
39 Buy
1 Hold
1 Sell
Strong Buy
Current: 199.640
Low
200.00
Averages
264.97
High
352.00
Current: 199.640
Low
200.00
Averages
264.97
High
352.00
About NVDA
NVIDIA Corporation is an artificial intelligence (AI) infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. Its segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing and networking platforms and AI solutions and software, and automotive platforms and autonomous and electric vehicle solutions, including software. The Graphics segment includes GeForce GPUs for gaming and personal computers (PCs), and Quadro/NVIDIA RTX GPUs for enterprise workstation graphics. Its technology stack includes the foundational NVIDIA CUDA development platform that runs on all NVIDIA GPUs, as well as hundreds of domain-specific software libraries, frameworks, algorithms, software development kits (SDKs), and application programming interfaces (APIs). Its platforms address four markets, which include Data Center, Gaming, Professional Visualization, and Automotive.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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