Tech companies can anticipate a more deregulated environment, a shift in the approach to mergers and acquisitions, and potential adjustments to the CHIPS Act during Donald Trump’s second term. Following Trump’s victory in the US election, stock prices surged, especially for major tech firms like Nvidia and Alphabet, which saw notable increases. Microsoft, a major investor in OpenAI, also benefited from the news, as experts predict a relaxed stance on AI regulation under Trump’s leadership.
Tech industry leaders, including Amazon’s Jeff Bezos, quickly congratulated Trump after his win. Tesla’s Elon Musk, a vocal Trump supporter during the campaign, has been appointed to lead the newly formed Department of Government Efficiency, alongside Vivek Ramaswamy.
Trump has expressed a clear interest in reevaluating policies related to chip production, mergers and acquisitions, antitrust regulations, AI, and sustainability. Here’s a breakdown of the key changes tech leaders can expect under his administration.
When the CHIPS are down
Trump has openly criticized the CHIPS and Science Act, a piece of legislation passed under President Biden that seeks to bolster domestic tech investment, particularly in semiconductors. On The Joe Rogan Experience podcast, Trump described the CHIPS Act as “so bad.”
Despite Trump’s criticism, experts suggest that the CHIPS Act is unlikely to be fully scrapped. A representative from Taiwanese tech manufacturer GlobalWafers notes that large, multi-year programs such as this one often continue under new administrations. However, Penn believes the root cause of why production moved offshore has not been addressed—companies prioritized profits and dividends over investing in manufacturing.
AI Policy Under Trump
In the lead-up to the election, Trump promised to repeal Biden’s executive order on AI, which aims to promote the responsible and safe use of artificial intelligence. The Republican platform condemned the order as “dangerous” and stifling innovation. However, AI safety remains a bipartisan issue. A recent Ipsos poll showed that 70% of Americans support AI safeguards, and certain elements of Biden’s AI order, such as privacy protections, may align with Republican values.
Trump’s stance on AI is still evolving. While he may move to repeal the Biden order, it remains unclear what policies will replace it. Trump’s unpredictable approach to tech policy, combined with his potential appointment of Musk—a known AI sceptic—adds uncertainty to future AI regulations. Musk has voiced concerns about the existential risks posed by AI, even opposing the California AI Bill.
Both major political parties see AI as a national security issue. Trump, for instance, has focused on competing with China in the tech space, emphasizing cybersecurity and AI as critical areas of national defence.
Tech, AI, and Environmental Concerns
Trump’s “drill, baby, drill” rhetoric indicates a preference for economic and security concerns over environmental issues. For tech companies that rely on significant energy and water usage, such as AI providers, this could be seen as a positive shift.
Many tech giants that once emphasized sustainability have started to scale back these claims. Experts like former Google CEO Eric Schmidt suggest that AI companies should not be tied to strict environmental goals. Craig Wentworth, an analyst at TechMarketView, believes that a deregulated Trump administration could support this view, promoting US competitiveness globally. However, he cautions that removing AI from Scope 3 emissions calculations could create challenges in tracking progress toward global sustainability goals.
Antitrust and Mergers
Under Biden, the US Department of Justice (DoJ) pursued aggressive antitrust actions, including lawsuits against Google and a potential breakup of Alphabet. The DoJ’s ruling is expected in April 2025, allowing Trump time to alter the course of these efforts.
Trump is likely to take a less aggressive stance on antitrust policies, potentially enabling more mergers and acquisitions (M&A). The Federal Trade Commission (FTC), led by Lina Khan under Biden, has scrutinized major tech acquisitions, including Microsoft’s purchase of Activision Blizzard and Meta’s acquisition of Within. However, with Trump in office, the regulatory environment could become more favourable for large tech companies, especially those aligned with his administration, such as Musk’s ventures.
In Summary
While it’s too early to predict the full impact of a Trump administration on the tech sector, analysts like Wentworth expect that Trump’s supporters in the tech world will benefit most from the potential changes in regulation. However, some tech businesses may be concerned about being on the “wrong side” of Trump’s political decisions.