By Emily Bary
Trump vows to impose roughly 100% tariffs on semiconductors unless companies build in the U.S. Is it the latest installment of the ‘TACO’ trade?
Earlier this year, Nvidia pledged to make AI supercomputers in the U.S.
President Donald Trump threatened steep tariffs for the semiconductor industry if they don’t build in the U.S., but major chip stocks are largely shrugging off his latest comments.
Trump’s Wednesday remarks were somewhat vague, with Trump saying he “will be putting a tariff of approximately 100% on chips and semiconductors” but declining to provide details on when those rules would go into effect.
He also said there would be exceptions for companies “building” in the U.S., without going into detail about how much domestic manufacturing these companies actually have to be doing.
“If you’re building in the United States of America, there’s no charge,” he said. “Even though you’re building and you’re not producing yet in terms of the big numbers of jobs and all of the things that you’re building, if you’re building, there will be no charge.”
Trump made his comments alongside Apple Inc. (AAPL) Chief Executive Tim Cook, who pledged $100 billion more in U.S. investments on top of the $500 billion the company had previously committed over a multiyear span. As part of the latest round, Apple will spend $2.5 billion to manufacture cover glass for iPhones and watches at a Corning Inc. (GLW) facility in Kentucky.
See more: Apple’s stock gains as new announcement with Trump could help its tariff problem
While Trump got to hail the investment as a win for domestic iPhone production, analysts remain skeptical that the latest pledge will drive a dramatic change in Apple’s iPhone manufacturing process.
“The reality continues to be that producing iPhones in the U.S. is unrealistic given the cost structure vs. Asia/India and remains a fairy tale concept in our view,” Wedbush’s Daniel Ives wrote on Wednesday.
Meanwhile, Nvidia Corp. shares (NVDA) rose 0.6% in Wednesday’s extended session, while shares of Advanced Micro Devices Inc. (AMD) gained 1%. Marvell Technology Inc. stock (MRVL) was fractionally higher, while Broadcom Inc. (AVGO), and Qualcomm Inc. (QCOM) edged slightly lower.
Nvidia has already made a U.S. investment pledge, saying in April that it would domestically produce up to $500 billion of artificial-intelligence infrastructure, including AI supercomputers, over four years. While the company is still producing other products overseas, the pledge could land favorably with Trump and chip-sector investors may reason that other big companies will follow suit if they haven’t already made public commitments of their own.
Shares Texas Instruments Inc. (TXN) and GlobalFoundries Inc. (GFS), two chip companies with more established U.S. presences already, gained about 2% and 8%, respectively, while Intel Corp.’s stock (INTC) rose 0.7% in Wednesday’s after-hours action.
Investors may also see the latest commentary factoring into another installment of the “TACO” trade – an acronym for “Trump always chickens out.” The term captures a sentiment by some on Wall Street that Trump makes draconian threats but ultimately backs off.
-Emily Bary
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08-06-25 2025ET
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