China probes U.S. chip exports: Why Texas Instruments and Analog Devices face new trade risk in 2025

Why is China targeting U.S. semiconductor exports with anti-dumping and discrimination probes?

China’s Ministry of Commerce has launched two significant investigations into U.S. semiconductor exports. The first is an anti-dumping probe focused on analog integrated circuits, targeting products such as interface chips and gate driver chips that are widely used in consumer electronics, industrial equipment, and automotive systems. The second is an anti-discrimination investigation that scrutinizes U.S. trade and export control policies to determine if they unfairly disadvantage Chinese firms in the global chip market.

Both actions are timed just days before a scheduled U.S.–China trade summit in Madrid, amplifying the geopolitical significance of these probes. Analysts see this as Beijing’s attempt to counter escalating export controls, tariffs, and licensing restrictions imposed by Washington under national security pretexts. While previous Chinese trade responses largely centered around retaliatory tariffs or diplomatic protests, these probes mark a more legally formal and economically strategic pushback.

What triggered China’s formal retaliation against U.S. chipmakers in 2025?

China’s frustration has been steadily growing since the United States began tightening export controls on advanced semiconductors and chipmaking equipment in 2022. Under the Biden administration and continuing into the second Trump term, U.S. regulators have moved aggressively to curb China’s access to key technologies, citing national security risks around AI, 5G, quantum computing, and high-performance compute systems. Key measures have included the addition of Chinese firms like Huawei and SMIC to the U.S. Entity List, and stringent restrictions on exports of Nvidia’s A100 and H100 chips as well as ASML’s EUV lithography tools.

By opening anti-dumping investigations, China is accusing American firms of undercutting local chip prices in ways that harm its domestic industry. The specific focus on analog ICs—critical but often overlooked components in modern electronics—suggests that Beijing is targeting a segment where U.S. firms like Texas Instruments, Analog Devices, and ON Semiconductor have historically maintained strong market positions.

Simultaneously, the anti-discrimination probe takes aim at U.S. policymaking itself. This includes concerns over export licensing delays, restrictions on capital flows into Chinese chip startups, and broader protectionist behavior embedded in U.S. legislation such as the CHIPS and Science Act. China is positioning this as a fight not just over pricing, but over principles of fair market access and reciprocal trade norms.

How does this fit into the historical U.S.–China semiconductor standoff?

The trade war between the U.S. and China formally began with tariffs, but semiconductors quickly became the central battleground. China has long aspired to achieve chip self-sufficiency through initiatives like “Made in China 2025” and state-driven investment in national champions. However, its dependence on foreign-designed chips—especially from the United States—remains significant in analog, RF, and cutting-edge AI chips.

U.S. policymakers have responded by weaponizing export control regimes, hoping to slow China’s technological progress while reshoring key parts of the semiconductor supply chain. These tools have included Commerce Department regulations, Entity List designations, and national security reviews under CFIUS. The broader Western alliance has also contributed, with countries like the Netherlands and Japan imposing parallel restrictions.

China’s current use of anti-dumping and anti-discrimination tools is legally grounded in the WTO framework, even though many of the U.S. actions it complains about fall outside traditional trade law norms. This evolving back-and-forth illustrates a shift in strategy: instead of tit-for-tat tariffs, both sides are now embedding their tech rivalries into regulatory and legal frameworks. The goal is no longer just to protect trade surpluses—it’s to shape the rules of global technology governance.

Which U.S. semiconductor firms are most at risk from these probes?

Analog chipmakers are squarely in the crosshairs. Texas Instruments (NASDAQ: TXN), which has a significant footprint in interface chips, motor drivers, and power management ICs, could face pricing pressure and market access hurdles. Analog Devices (NASDAQ: ADI), known for signal processing and mixed-signal chips, is also exposed due to its broad product portfolio in the automotive, industrial, and healthcare sectors.

ON Semiconductor, Microchip Technology, and other mid-tier analog vendors could also be affected depending on how China defines the scope of dumping behavior and whether duties or quotas are imposed. These companies derive between 10–30% of their revenue from China or China-adjacent markets.

While the discrimination probe is more diffuse, it poses systemic risk for any firm that relies on cross-border licensing, technology transfer, or joint ventures with Chinese entities. Investors will be watching closely for potential secondary impacts on larger firms like Nvidia, Intel, and Qualcomm, even though their primary product lines may not be directly involved in the dumping case.

How are public markets and institutional investors responding?

Shares of Texas Instruments and Analog Devices declined in early trading following the probe announcement, reflecting investor concern over regulatory headwinds. Institutional investors have begun repositioning their semiconductor portfolios by shifting allocations toward companies with minimal China exposure and diversified revenue streams.

Fund managers tracking chip ETFs and tech mutual funds are evaluating risk premiums for analog-heavy holdings, especially those with more than 20% revenue exposure to China. Analysts at several investment banks have flagged these probes as catalysts for multiple compression, earnings volatility, and a possible shift in sector leadership from analog to digital-centric semiconductor firms focused on AI, data centers, and edge compute.

What are the global trade and supply chain implications of China’s legal counteroffensive?

China’s move complicates the already fragile semiconductor supply chain that has yet to fully recover from pandemic-era shocks and logistics snarls. Analog ICs are foundational to every electronic product, from smartphones to satellites. Any disruption in pricing, certification, or import policy could have knock-on effects across industries.

Countries like India, Vietnam, and Malaysia—positioning themselves as alternatives to China in semiconductor packaging and assembly—could benefit from increased nearshoring or re-routing of supply chains. However, such transitions are capital intensive and time-consuming. In the short term, product redesigns, buffer inventories, and sourcing diversification may be the only immediate mitigations.

Multinational electronics and auto firms operating in China may also face delays or cost increases if analog ICs become entangled in compliance hurdles. If dumping penalties or restrictions emerge, OEMs may need to source from Chinese analog chip firms—which could, paradoxically, boost China’s own domestic analog IC sector in the medium term.

What could come out of the U.S.–China trade talks in Madrid?

The probes are clearly timed for maximum diplomatic leverage. With talks underway in Madrid, China will likely present these investigations as evidence of U.S. trade bias, demanding rollbacks or at least clarifications of chip-related export controls. U.S. negotiators, meanwhile, are expected to hold their line on national security exceptions and continue to support the ongoing restrictions on AI chips and equipment.

Observers are closely watching whether the U.S. offers any narrow concessions—such as easing certain licensing burdens—or whether the talks deadlock entirely. The outcome will not only influence near-term investor sentiment but also signal whether bilateral tech decoupling will continue or modulate.

Should negotiations fail, a wider trade escalation is on the table, potentially dragging in other high-tech sectors such as green energy, biotech, and quantum computing. Alternatively, both sides may agree to confidence-building measures, such as resumed tech dialogues or regulatory coordination on standards bodies, to avoid further economic fragmentation.

What’s next for semiconductor investors and supply chain planners?

Analysts expect China’s Ministry of Commerce to conclude the anti-dumping probe within 12 to 18 months. In the interim, regulatory uncertainty is likely to weigh on investor confidence in analog-heavy chipmakers. Companies with deeper exposure to China may need to issue forward-looking statements or earnings guidance updates addressing potential risk to demand and pricing.

Supply chain planners, especially those in industrial IoT, automotive, and telecom, should prepare for sourcing bottlenecks, compliance audits, or shifts in pricing structures for analog ICs. Any disruption in availability or cost of gate drivers, interface ICs, or power chips could cascade through product development cycles.

With semiconductors now squarely caught in the geopolitical crossfire, long-term investors will need to weigh not just revenue diversification and technological moat, but also regulatory resilience and adaptability to evolving trade regimes. The battle over chips is no longer just about nodes and nanometers—it’s about narratives, sovereignty, and the legal frameworks that underpin global innovation.