Geopolitical Risks & Overseas Fab Expansion

Taiwan drills, water scarcity, talent shortage; China restricting germanium/quartz exports (new: production bottlenecks in aerospace and optics); Arizona yield 4% higher than Taiwan; all four overseas fabs profitable in 1H26; margin dilution 2-4% over 2024-2029; Strait closure scenario analysis. Taiwan launched Chip Materials Alliance to counter supply chain risks, leveraging 30% global materials share. A Strait Risk article frames the tension between AI demand and geopolitical risk.