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Reuters

  • Drugmakers racing to launch the first weight-loss pill

    Drugmakers racing to launch the first weight-loss pill

    Weight-loss drugs are expected to pull in more than $150 billion in industry-wide revenue by the early 2030s, thanks to the ever-growing popularity of Eli Lilly’s Zepbound and Novo Nordisk’s Wegovy.

    Both the GLP-1 weight loss drugs are weekly injections, although several drugmakers are racing to develop an oral medicine or pill that might prove to be as effective as the injectables.

    Pills are easier to manufacture and could also avoid some of the supply issues that were initially seen with Novo and Lilly’s drugs.

    Here are some companies developing oral obesity drugs in the hopes of making their mark in a lucrative market:

    ELI LILLY

    Orforglipron, the company’s once-daily oral non-peptide GLP-1 agonist, helped patients shed 12.4% of body weight over 72 weeks at the highest dose in a late-stage trial. Lilly plans to file for regulatory approval by the end of 2025 and is preparing for global submissions and manufacturing scale-up.

    NOVO NORDISK

    Oral semaglutide, a pill version of the company’s injectable GLP-1 active ingredient, demonstrated about 15% weight loss in a late-stage trial.

    The drug is currently under regulatory review, with a U.S. FDA decision expected in late 2025. Novo is also exploring next-generation oral combinations.

    STRUCTURE THERAPEUTICS

    Structure Therapeutics is developing GSBR-1290, a non-peptide oral GLP-1 agonist. Last year, the drug helped reduce weight by 6.2% on average at the end of 12 weeks in a mid-stage study. It is expected to report results from another mid-stage trial in the fourth quarter.

    MERCK

    The company, in partnership with Hansoh Pharma, is preparing to test HS-10535, an oral small-molecule GLP-1 agonist, in early-stage trials. The drug is currently being tested in lab studies.

    ASTRAZENECA

    AstraZeneca and Eccogene are advancing ECC5004, a once-daily GLP-1 receptor agonist pill. Early stage trial showed a promising weight-loss signal and a favorable safety profile, with mid stage trials planned under AstraZeneca’s lead.

    ROCHE

    Roche, following its acquisition of Carmot Therapeutics, is working on CT-966, an oral GLP-1 agonist. CT-966 resulted in a placebo-adjusted average weight loss of 6.1% within four weeks in obese patients without diabetes in an early-stage trial last year.

    VIKING THERAPEUTICS

    The company is developing an oral formulation of VK2735, a dual GLP-1/GIP receptor agonist. Nine patients who received the highest 100 milligram dose lost an average of 8.2% of their body weight after 28 days, compared with 1.4% for a placebo, in an early stage trial. A mid-stage trail was started this year, with results expected in second half.

    PFIZER

    Pfizer was developing danuglipron, initially as a twice-daily oral GLP-1 agonist, but scrapped development after data from a mid-stage trial showed poor tolerability. A once-daily extended-release version was later tested in about 1,400 patients but liver safety concerns remained, dampening the company’s plans to enter the obesity drug market.

    Zepbound: Weight loss from drug reversed after stopping treatment

  • Trump: Important that Middle Eastern countries join Abraham Accords

    Trump: Important that Middle Eastern countries join Abraham Accords

    WASHINGTON, August 7: US President Donald Trump said on Thursday it was important that Middle Eastern countries join the Abraham Accords, which aim to normalize diplomatic ties with Israel, saying it will ensure peace in the region.

    “Now that the nuclear arsenal being ‘created’ by Iran has been totally OBLITERATED, it is very important to me that all Middle Eastern Countries join the Abraham Accords,” Trump wrote in a social media post.

    As part of the Abraham Accords, signed during Trump’s first term in office, four Muslim-majority countries agreed to normalize diplomatic relations with Israel after U.S. mediation. Efforts to expand the accords have been complicated by a soaring death toll and starvation in Gaza.

    The war in Gaza, where local authorities say more than 60,000 people have died, has provoked global anger. Canada, France and the United Kingdom have announced plans in recent days to recognize an independent Palestinian state.

    Trump’s administration is actively discussing with Azerbaijan the possibility of bringing that nation and some Central Asian allies into the Abraham Accords, hoping to deepen their existing ties with Israel, according to five sources with knowledge of the matter.

    The Abraham Accords are historic agreements signed in 2020, brokered by the United States, aimed at normalizing diplomatic relations between Israel and several Arab countries. These agreements marked a significant shift in the Middle Eastern geopolitical landscape, promoting peace, economic cooperation, and security dynamics in the region. By establishing formal ties between Israel and Arab states, the Accords broke with decades of policy in the Arab world.

  • US plan sees Hezbollah disarmed by year-end, Israeli withdrawal

    US plan sees Hezbollah disarmed by year-end, Israeli withdrawal

    BEIRUT, Aug 7, 2025: The United States has presented Lebanon with a proposal for disarming Hezbollah by the end of the year, along with ending Israel’s military operations in the country and the withdrawal of its troops from five positions in south Lebanon, according to copy of a Lebanese cabinet agenda reviewed by Reuters.

    The plan, submitted by U.S. President Donald Trump’s envoy to the region, Tom Barrack, and being discussed at a Lebanese cabinet meeting on Thursday, sets out the most detailed steps yet for disarming the Iran-backed Hezbollah, which has rejected mounting calls to disarm since last year’s devastating war with Israel.

    The U.S. State Department did not immediately respond to a request for comment.
    Lebanese government ministers could not immediately be reached for comment.

    Hezbollah had no immediate comment on the proposal.

    Israel dealt major blows to Hezbollah in an offensive last year, the climax of a conflict that began in October 2023 when the Lebanese group opened fire at Israeli positions at the frontier, declaring support for its militant Palestinian ally Hamas at the start of the Gaza war.

    Trump: Middle East countries should normalize ties with Israel

    The U.S. proposal aims to “extend and stabilise” a ceasefire agreement between Lebanon and Israel brokered in November.

    “The urgency of this proposal is underscored by the increasing number of complaints regarding Israeli violations of the current ceasefire, including airstrikes and cross-border operations, which risk triggering a collapse of the fragile status quo,” it said.

    Phase 1 of the plan requires the Beirut government to issue a decree within 15 days committing to Hezbollah’s full disarmament by December 31, 2025. In this phase, Israel would also cease ground, air and sea military operations.

    Phase 2 requires Lebanon to begin implementing the disarmament plan within 60 days, with the government approving “a detailed (Lebanese army) deployment plan to support the plan to bring all arms under the authority of the state”. This plan will specify disarmament targets.

    During Phase 2, Israel would begin withdrawing from positions it holds in south Lebanon and Lebanese prisoners held by Israel would be released in coordination with the International Committee of the Red Cross (ICRC).

    During Phase 3, within 90 days, Israel will withdraw from the final two of the five points it holds, and funding will be secured to initiate rubble removal in Lebanon and infrastructure rehabilitation in preparation for reconstruction.

    In Phase 4, within 120 days, Hezbollah’s remaining heavy weapons must be dismantled, including missiles and drones.

    In Phase 4, the United States, Saudi Arabia, France, Qatar and other friendly states will organise an economic conference to support the Lebanese economy and reconstruction and to “implement President Trump’s vision for the return of Lebanon as a prosperous and viable country”.

  • Trump calls on ‘highly conflicted’ Intel CEO to resign over China ties

    Trump calls on ‘highly conflicted’ Intel CEO to resign over China ties

    U.S. President Donald Trump on Thursday demanded the immediate resignation of new Intel CEO Lip-Bu Tan, calling him “highly conflicted” due to his ties to Chinese firms and raising questions about plans to turn around the struggling American chip icon.

    Reuters reported exclusively in April that Tan – himself or through venture funds he has founded or operates – invested at least $200 million in hundreds of Chinese advanced manufacturing and chip firms, some of which are linked to the Chinese military.

    Trump’s comments came a day after Reuters was first to report that Republican Senator Tom Cotton had sent a letter to Intel’s board chair with questions about Tan’s ties to Chinese firms and a recent criminal case involving his former firm Cadence Design.

    “There is no other solution to this problem,” Trump said in a post on his Truth Social platform, knocking shares of Intel down around 2% in early U.S. trading.

    A change in leadership at Intel could pile pressure on the company, which is also a pillar of U.S. efforts to boost domestic chipmaking. Last year it secured $8 billion in subsidies, the largest outlay under the 2022 CHIPS and Science Act, to build new fabs in Ohio and other states.

    Analysts debated whether Trump should be making calls on corporate leadership.

    “It would be setting a very unfortunate precedent. You don’t want American presidents dictating who runs companies, but certainly his opinion has merit and weight,” said Phil Blancato, CEO of Ladenburg Thalmann Asset Management, which does not own Intel shares.

    David Wagner, head of equity and portfolio manager at Intel shareholder Aptus Capital Advisors, responded that while “many investors likely believe that President Trump has his hand in too many cookie jars, it’s just another signal that he’s very serious about trying to bring business back to the U.S.”

    Intel and Tan, who took over as Intel CEO in March, did not immediately respond to Reuters requests for comment. An Intel spokesperson said in a statement on Wednesday that “Intel and Tan are deeply committed to the national security of the U.S. and the integrity of our role in the U.S. defense ecosystem.”

    Reuters in April reported that Tan between March 2012 and December 2024 invested in Chinese firms, including in contractors and suppliers for the People’s Liberation Army, according to a review of Chinese corporate databases cross-referenced with U.S. and analyst lists of companies with connections to the Chinese military.

    Read more: Nvidia set to become world’s most valuable company

    Reuters identified 20 investment funds and companies where the Intel CEO’s venture capital firm Walden is currently a joint owner along with Chinese government funds or state-owned enterprises, according to Chinese corporate records. The government funds are mostly from municipal governments of Chinese tech hubs like Hangzhou, Hefei, and Wuxi.

    A source familiar with the matter had at the time told Reuters that the Intel CEO had divested his positions in entities in China, without providing further details. Chinese databases reviewed by Reuters at the time had listed many of his investments as current, and Reuters was at the time unable to establish the extent of his divestitures.

    Tan, a Malaysian-born Chinese American business executive, was also the CEO of Cadence Design from 2008 through December 2021 during which the chip design software maker sold products to a Chinese military university believed to be involved in simulating nuclear explosions.

    Cadence last month agreed to plead guilty and pay more than $140 million to resolve the U.S. charges over the sales, a deal Reuters first reported.

    BUSINESS TURMOIL

    “This all boils down to Lip Bu’s past involvement and investment in Chinese semiconductors, which is also what makes him so valuable as CEO,” said Anshel Sag, principal analyst at Moor Insights & Strategy.

    Once the dominant force in chip-making, Intel has in recent years lost its manufacturing edge to Taiwanese rival TSMC. It also has virtually no presence in the booming market for artificial intelligence chips dominated by Nvidia .

    Its shares are little changed so far in 2025, after dropping more than 60% last year. The company’s market value has fallen below $100 billion, with profit margins – once the envy of the industry – running at about half their historical highs.

    To revive Intel’s fortunes, the Intel CEO has set a goal of slashing the chipmaker’s workforce by around 22% to 75,000 people by year-end. Intel has also warned of exiting chip manufacturing if it fails to secure a major customer, a potentially drastic move.

  • Toyota warns of $9.5 billion tariff hit

    Toyota warns of $9.5 billion tariff hit

    TOKYO, Aug 7: Japan’s Toyota Motor said on Thursday it expected a hit of nearly $10 billion from President Donald Trump’s tariffs on cars imported into the United States, the highest such estimate yet by any company, underscoring growing margin pressures.

    The world’s top-selling car maker also cut by 16% its forecast for full-year operating profit, reflecting challenges for global manufacturers grappling with rising costs from U.S. levies on cars, parts, steel and aluminium.

    “It’s honestly very difficult for us to predict what will happen regarding the market environment,” Takanori Azuma, Toyota’s head of finance, told a briefing, vowing to keep making cars for U.S. customers, regardless of tariff impact.

    Azuma said the 1.4 trillion yen ($9.50 billion) estimate also includes fallout suppliers are facing, particularly those in the U.S. importing parts from Japan, though he declined to say how much of the total was attributable to that.

    Rivals have reported smaller tariff hits so far: GM has projected one of $4 billion to $5 billion for the year, while Ford expects a $3-billion gross hit to pretax adjusted profit.

    Jeep maker Stellantis said tariffs were expected to add $1.7 billion in expenses for the year.

    Toyota cut its operating profit forecast for the financial year to end-March 2026 to 3.2 trillion yen ($21.7 billion), down from a previous outlook of 3.8 trillion yen.

    It had previously estimated a tariff hit of 180 billion yen for April and May, but that was solely for the impact from tariffs on Toyota’s vehicles. It had not issued a full-year projection until now.

    For the first quarter from April to June, Toyota reported an operating profit of 1.17 trillion yen, down from 1.31 trillion a year earlier, but above the 902 billion average of seven analyst estimates compiled by LSEG.

    Toyota’s North American business swung to an operating loss of 63.6 billion yen in the first quarter, from profit of 100.7 billion a year earlier, as it took a hit of 450 billion from the tariffs.

  • Russia and India talk up ‘strategic partnership’ after Trump tariff hike

    Russia and India talk up ‘strategic partnership’ after Trump tariff hike

    MOSCOW/NEW DELHI, Aug 7: Russia and India stressed their commitment to a “strategic partnership” in bilateral security talks in Moscow on Thursday, a day after U.S. President Donald Trump announced higher tariffs on imports from India because of its purchases of Russian oil.

    Interfax news agency quoted Indian national security adviser Ajit Doval as saying that New Delhi was looking forward to a visit from President Vladimir Putin by the end of the year.

    At Doval’s meeting with Sergei Shoigu, secretary of Russia’s Security Council, both sides emphasised the importance of the countries’ relations.

    India state refiners pause Russian oil purchases, sources say

    Trump’s imposition of an additional 25% tariff on goods from India, coming into force on August 28, signals the most serious downturn in U.S.-India relations since his return to office in January, threatening to disrupt India’s access to its largest export market.

    “We are committed to further active cooperation in order to form a new, more just and sustainable world order, ensure the supremacy of international law, and jointly combat modern challenges and threats,” Shoigu told Doval in televised comments.

    Interfax quoted Doval as saying: “We have now established very good relations, which we value very much, a strategic partnership between our countries”.

    Trump 50 percent tariff on India: Impact on Modi and economy?

    India and China have become the top buyers of Russian seaborne crude oil since Moscow launched its full-scale invasion of Ukraine in February 2022, precipitating Western efforts to choke the Russian economy.

    Trump had threatened measures against countries buying Russian oil before he announced the new tariff on Indian goods, which raised the total duty to 50%.

    On Tuesday, the Kremlin accused the United States of exerting illegal trade pressure on New Delhi, saying India has the right to trade with whomever it chooses.

    India’s state refiners have stopped Russian oil purchases as the discounts narrowed and Trump warned countries not to buy Moscow’s oil, industry sources said. Private refiners Reliance Industries and Nayara are Russia’s top oil clients in India, trade data shows.

    An Indian official familiar with the matter said Doval would discuss India’s purchases of Russian crude during his visit to Moscow. He was also expected to discuss India’s defence collaboration with Russia, the official said.

    India signed a $5.5 billion deal with Russia in 2018 for five S-400 Triumf long-range surface-to-air missile systems, which New Delhi says it needs to counter a threat from China.

    But deliveries of the systems have been delayed several times. Moscow is expected to deliver units of the final two S-400 systems to India in 2026 and 2027.

    New Delhi has traditionally relied heavily on arms imports from Russia, although it has dramatically reduced those imports and shifted to Western buyers in recent years.

  • Burger King parent beats sales estimates on improving fast-food demand

    Burger King parent beats sales estimates on improving fast-food demand

    August 7, 2025: Restaurant Brands beat quarterly revenue estimates on Thursday, as its marketing efforts boosted demand at Burger King and other brands in the U.S. and international markets.

    However, higher expenses drove an earnings miss, and sent the company’s U.S.-listed shares down about 3% in early trading.

    The company leaned on movies such as ‘How to train your Dragon’ and partnerships with actor Ryan Reynolds, to attract customers in core regions such as the U.S. and Canada.

    Value-meal deals starting at $5, also introduced by major fast-food chains Yum Brands and McDonald’s as consumer spending in the U.S. sees a decline, boosted foot traffic at Burger King.

    McDonald’s global sales report- August 2025

    The Trump administration’s unpredictable trade policies have disrupted business operations and shaken consumers, especially lower-income groups, who are increasingly seeking bargains and scaling back on dining out plans as they grapple with rising prices.

    “We saw a bit softer performance in some of the lower-income cohorts in the U.S., and a little bit of better performance in the middle and higher income groups,” Restaurant Brands CEO Josh Kobza told Reuters.

    The company logged an adjusted profit of 94 cents per share, above 86 cents a year ago, but missed analysts’ estimates of 97 cents per share, also hurt by higher costs from supply chain and commodities such as beef and coffee.

    It posted revenue of $2.41 billion in the quarter ended June 30, beating analysts’ estimates of $2.32 billion, according to data compiled by LSEG.

    Quarterly same-store sales at Burger King outlets in the U.S., rose 1.5%, after rising just 0.1% a year ago.

    Comparable sales in the company’s international segments, which include restaurant chains such as Burger King and Popeyes, rose 4.2%, compared with a 2.6% rise a year ago.

  • ESPN-NFL deal faces regulatory hurdles

    ESPN-NFL deal faces regulatory hurdles

    LOS ANGELES, Aug 7: The National Football League (NFL) deal with Walt Disney in which it will gain an equity stake in ESPN in return for prime media assets is expected to face scrutiny from the U.S. Department of Justice, according to legal experts and industry sources.

    The agreement, announced late Tuesday, involves Disney’s ESPN acquiring the NFL Network and other media properties in exchange for the league receiving a 10 percent stake in the sports network.

    Andre P. Barlow, a partner at Doyle, Barlow & Mazard, said the transaction “surely raises competition concerns,” because it could potentially give Disney greater control over televised sports carriage and reduce competition.

    “The deal could potentially result in higher costs for consumers, as Disney’s dominance in sports media could limit options and drive up prices for streaming services or game access,” Barlow said.

    The Justice Department is expected to conduct a substantive review of the new ESPN-NFL transaction, according to one source familiar with the matter who spoke on condition of anonymity. Another source said obtaining U.S. antitrust clearance could take up to 12 months.

    ESPN and the NFL declined comment.

    The expected review comes as the Justice Department’s Antitrust Division is examining a separate deal Disney reached earlier this year to acquire a controlling stake in the sports streaming service Fubo TV. The division demanded further information from the companies in March to examine whether the deal would unduly concentrate the market for sports streaming.

    Meanwhile, the issue of rising costs for fans as games migrate to streaming services has reached the Senate, where the Commerce Committee held a hearing in May.

    “In an era of deep partisan division, sports might be the most powerful cultural unifier we have,” said Republican Senator Ted Cruz of Texas, who chairs the committee, noting it brings together Americans whether they’re watching from their couches or in the stands.

    “But those millions of fans are asking a simple question: ‘Why does it seem to be getting harder — and more expensive — to just watch the game?’”

    John Bergmayer, legal director of the non-profit Public Knowledge, voiced the same concerns.

    “The proliferation of streaming services — and the fragmentation of content between them — means that the costs of watching streaming video are rising, and for many people can approach what they were paying on their cable bill,” said Bergmayer in testimony to the committee. “Some viewers feel like they finally broke free of the cable bundle only to watch it re-forming (before) their eyes.”

    ESPN STREAMING SERVICE

    The NFL has done outreach to 30 congressional offices to discuss the terms of its deal with ESPN and how it would result in greater consumer choice, according to one of the sources.

    Under the agreement, ESPN would be able to add the NFL Network to its breadth of sports programming and incorporate it as part of its ESPN-branded streaming service. ESPN also plans to merge its fantasy football offering with that of the NFL.

    ESPN also will be able to distribute the NFL’s RedZone to cable and satellite TV distributors, along with its other channels. The NFL will retain streaming rights to NFL RedZone, which is available online through YouTube TV.

    Disney won swift approval for its $71 billion acquisition of 21st Century Fox’s entertainment assets in 2018, during President Donald Trump’s first term, though it was required to divest Fox’s 22 regional sports networks to address competition concerns. At the time, Trump called to congratulate the Fox’s Rupert Murdoch on the deal.

    “It was worked out in record time,” said Barlow, adding that this time around, he expects the Justice Department “to take a close look before approving the deal.”

    One recent media deal, the $8.4 billion merger of Paramount Global and Skydance Media, became bogged down in a lengthy regulatory review, as President Donald Trump sued Paramount, claiming the CBS News program “60 Minutes” deceptively edited an interview with his Democratic rival for the White House, former Vice President Kamala Harris.

    The Federal Communications Commission approved the transaction within days of Trump receiving a $16 million settlement, though FCC Chairman Brendan Carr said the civil suit and regulatory review were unrelated.

    Politics could complicate the deal. Some sports industry insiders pointed to Trump’s threats to interfere with a deal to build a new football stadium in Washington, D.C., unless the local NFL team, now known as the Commanders, changes its name back to Redskins, which was abandoned after decades of criticism that it was a racial slur.

    ESPN is currently 80 percent owned by ABC Inc as an indirect subsidiary of Disney, with the other 20% owned by Hearst. If the deal is approved, ABC’s stake would drop to 72 percent and Hearst would fall to 18 percent to grant the NFL a 10 percent stake.

  • Trump could meet Putin over Ukraine as soon as next week, official says

    Trump could meet Putin over Ukraine as soon as next week, official says

    President Donald Trump could meet Vladimir Putin as soon as next week, a White House official said on Wednesday, as the US continued preparations to impose secondary sanctions, including potentially on China, to pressure Moscow to end the war in Ukraine.

    Such a face-to-face meeting would be the first between a sitting US and Russian president since Joe Biden met Putin in Geneva in June 2021, some eight months before Russia launched the biggest attack on a European nation since World War Two.

    Putin and Ukrainian President Volodymyr Zelenskiy have not met since December 2019 and make no secret of their contempt for each other.

    The New York Times reported that Trump told European leaders during a call on Wednesday that he intended to meet with Putin and then follow up with a trilateral involving the Russian leader and Zelenskiy.

    “There’s a good chance that there will be a meeting very soon,” Donald Trump told reporters.

    White House press secretary Karoline Leavitt said: “The Russians expressed their desire to meet with President Trump, and the president is open to meeting with both President Putin and President Zelenskiy.”

    The details emerged following a meeting on Wednesday between Putin and U.S. special envoy Steve Witkoff that Trump described as having achieved “great progress” in a Truth Social post, although later said he would not call it a breakthrough.
    A Kremlin aide said the talks were “useful and constructive.”

    The diplomatic maneuvers come two days before a deadline set by Trump for Russia to agree to peace in Ukraine or face new sanctions.

    Trump has been increasingly frustrated with Putin over the lack of progress towards peace and has threatened to impose heavy tariffs on countries that buy Russian exports, including oil.

    Trump on Wednesday also said he could announce further tariffs on China similar to the 25% duties announced earlier on India over its purchases of Russian oil.

    “We did it with India. We’re doing it probably with a couple of others. One of them could be China,” he said.

    Read more: US envoy Witkoff arrives in Russia ahead of sanctions deadline

    The White House official earlier said that while the meeting between Witkoff and Putin had gone well and Moscow was eager to continue engaging with the United States, secondary sanctions that Trump had threatened against countries doing business with Russia were still expected to be implemented on Friday.

    Kremlin foreign policy aide Yuri Ushakov said the two sides had exchanged “signals” on the Ukraine issue and discussed the possibility of developing strategic cooperation between Moscow and Washington, but declined to give more details until Witkoff had reported back to Donald Trump.

    Zelenskiy said he believed pressure had worked on Russia and Moscow was now more “inclined” to a ceasefire.

    “The pressure on them works. But the main thing is that they do not deceive us in the details – neither us nor the US,” Zelenskiy said in his nightly address.

    Donald Trump on Truth Social said he had updated some of Washington’s European allies following Witkoff’s meeting.

    A German government spokesperson said Trump provided information about the status of the talks with Russia during a call with the German chancellor and other European leaders.

  • Trump says US will levy 100% tariff on some chip imports

    Trump says US will levy 100% tariff on some chip imports

    The United States (US) will impose a tariff of about 100% on semiconductor chips imported from countries not producing in America or planning to do so, President Donald Trump said.

    Donald Trump told reporters in the Oval Office on Wednesday the new tariff rate would apply to “all chips and semiconductors coming into the United States,” but would not apply to companies that had made a commitment to manufacture in the United States or were in the process of doing so.

    “If, for some reason, you say you’re building and you don’t build, then we go back and we add it up, it accumulates, and we charge you at a later date, you have to pay, and that’s a guarantee,” Trump added.

    The comments were not a formal tariff announcement, and Trump offered no further specifics.

    It is not clear how many chips, or from which country, would be impacted by the new levy. Taiwanese chip contract manufacturer TSMC (2330.TW), opens new tab – which makes chips for most U.S. companies – has factories in the country, so its big customers such as Nvidia (NVDA.O), opens new tab are not likely to face increased tariff costs.

    The AI chip giant has itself said it plans to invest hundreds of billions of dollars in U.S.-made chips and electronics over the next four years. An Nvidia spokesperson declined to comment for this story.

    “Large, cash-rich companies that can afford to build in America will be the ones to benefit the most. It’s survival of the biggest,” said Brian Jacobsen, chief economist at investment advisory firm Annex Wealth Management.

    Congress created a $52.7 billion semiconductor manufacturing and research subsidy program in 2022. The Commerce Department under President Joe Biden last year convinced all five leading-edge semiconductor firms to locate chip factories in the U.S. as part of the program.

    Read more: Nvidia says it will resume sales of ‘H20’ AI chips to China

    The department said the US last year produced about 12% of semiconductor chips globally, down from 40% in 1990.

    Any chip tariffs would likely target China, with whom Washington is still negotiating a trade deal.

    “There’s so much serious investment in the United States in chip production that much of the sector will be exempt,” said Martin Chorzempa, senior fellow at the Peterson Institute for International Economics.

    Since chips made in China won’t be exempt, chips made by SMIC or Huawei would not be either, Chorzempa said, noting that chips from these companies entering the US market were mostly incorporated into devices assembled in China.

    “If these tariffs were applied without a component tariff, it might not make much difference,” he said.

    Chipmaking nations South Korea and Japan, as well as the European Union, have reached trade deals with the US, potentially giving them an advantage.

    The EU said it agreed to a single 15% tariff rate for the vast majority of EU exports, including cars, chips and pharmaceuticals. South Korea and Japan said separately that US agreed not to give them worse tariff rates than other countries on chips, suggesting a 15% levy as well.