The US Department of Commerce is reportedly preparing new regulations that would restrict the export of advanced AI chips to Thailand and Malaysia to prevent their diversion into China, according to industry sources.

Several leading Taiwanese display driver IC (DDI) manufacturers reported notable revenue declines for June, highlighting ongoing market headwinds as early demand surges from the first half of 2025 taper off. Key players, including Novatek Microelectronics Corp., Raydium Semiconductor Corporation, Fitpower Integrated Technology, FocalTech Systems, and Ilitek, all recorded either significant month-over-month or year-over-year decreases in revenue, signaling a broader weakening in market momentum.

Malaysia’s Penang state, home to about 13% of global semiconductor assembly and testing capacity, is positioning itself to capture more advanced chip manufacturing as artificial intelligence (AI) drives demand for sophisticated packaging technologies.