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Middle East Conflict Strains Semiconductor Supply Chain as Chipmakers Warn of Rising Costs

The Iran conflict is creating significant headwinds for semiconductor manufacturers, with major players flagging supply chain disruptions and cost pressures during earnings season. TSMC, which produces chips for Nvidia, warned that Middle East developments could impact profitability as prices for chemicals and gases rise. Foxconn, the world's largest contract electronics manufacturer, identified regional events as a key challenge. Infineon cited rising costs for precious metals, energy and freight. Helium shortages loom as a particular concern, with Qatar—which supplied over 30% of the global market in 2025—facing export capacity constraints from Iranian strikes. Access to other critical materials including bromine and aluminum faces similar risks. Industry analysts expect pricing pressures to persist for several quarters even if tensions de-escalate. Supply-side damage does not improve overnight.