US-China Tariff Tensions Boost Graphics Card Demand for MSI and Gigabyte

As the US-China tariff delays near expiration, companies like MSI and Gigabyte are experiencing increased demand for gaming graphics cards. This comes as electronics suppliers rush to stock up ahead of possible new tariff hikes.

Anticipating Tariff Changes

The trade tensions between the US and China saw a temporary reprieve earlier in the year, allowing importing businesses until July 9 to adjust. In preparation for a potential rise in tariffs, companies such as MSI and Gigabyte boosted their inventory in the US.

MSI Chairman Joseph Hsu revealed at a recent shareholder meeting that partners are challenged in maintaining inventory due to the immediacy with which graphics cards are purchased upon arrival. New tariffs could increase duties to 145% for Chinese goods if negotiations fall through.

Sector-Wide Implications

While temporary tariffs remain at 30% for Chinese imports and 10% for US exports, MSI and Gigabyte are bracing for future uncertainties. Both companies sell about 20% of their gaming products to the US market.

Notably, MSI is diversifying its manufacturing. By 2027, they plan to open a new facility in northern Taiwan for producing various hardware. Additionally, they’re working on expanding production in Vietnam and Thailand and setting up assembly operations in California.

Gigabyte’s Strategic Moves

Similarly, Gigabyte reported record revenues as clients pushed for increased stock in the US. The company sees the looming tariffs as a source of uncertainty but proceeds with plans to open a server assembly unit in California focused on AI applications.

These developments come amid concerns over Taiwan’s currency fluctuations, presenting risks for exporters like Gigabyte. Both companies aim to navigate tariff challenges by expanding operations beyond China.