TSMC and ASML Maintain Monopoly in AI Chip Race

Investment analysis from Baillie Gifford & Co. indicates that Taiwan Semiconductor Manufacturing Co. (TSMC), ASML Holding, and SK Hynix maintain near-monopoly positions in advanced semiconductor manufacturing. TSMC recently reported $40.2 billion in revenue, driven by strong AI-related demand. Analysts argue that TSMC's dominance is rooted in decades of accumulated process knowledge and reinforced by export controls that block Chinese firms from accessing essential equipment.

While China remains an innovation hub through companies like Tencent and BYD, firms such as ChangXin Memory Technologies struggle to replicate leading-edge processes. SK Hynix is seeing increased revenue from high-bandwidth memory, though it is considering a stake sale of its $3 billion semiconductor packaging plant in Chongqing due to strategic pressures.