Global | Tracking the Semiconductor Sector: An AI approach with NLP and Big Data

We analyze the evolution of the semiconductor industry with the use of Big Data from global news databases (from GDELT) and NLP tecniques for sentiment analysis. By complementing with Google Trends and other BBVA Research geopolitical indicators, we analyze the main actors and components of the industry evolution.

Key points

• Key points:
• Semiconductors are essential to modern technologies and play a critical role in some key strategic industries
• The Global Semiconductor Crisis has been driven by different factors such as the US-China trade war, the industry capacity related problems after the COVID-19 and key geopolitical events such as the China-Taiwan tensions and the Russia-Ukraine war. The easing of some of these factors has recently supported a significant ease of our Global Semiconductor Sentiment index.
• The National Sentiment Indexes have displayed different relative relevance during different episodes. Asian countries and the US were dominating sentiment tensions due to trade wars (2018-2019) and some European tensions surged during Post Covid Bottlenecks. The resolution of bottlenecks has reinforced a general ease of tensions for semiconductors.
• The heightened geopolitical tensions between US-China-Taiwan during U.S. House Speaker Nancy Pelosi’s visit to Taiwan in 2022 and Taiwan President Tsai Ing-wen’s visit to US in March 2023 have triggered a significant ease period due to the increasing diplomatic efforts, which culminated in the meeting between Biden-Xi Jinping last November 2023.
• Analyzing the proximity of companies in the media, we built a NLP Network of the Industry to show the relevance of the Taiwan Semiconductor Manufacturing Company (TSMC) for the world semiconductor industry. The role of TSMC as a key provider of advanced chips and its position in the Semiconductor Value Chain make TSMC an important systemic risk for the semiconductor industry and advanced economies.

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