As the conflict with Iran stretches into its third week, the technology industry is assessing vulnerabilities in two foundational areas: semiconductor manufacturing and the construction of large-scale data centers in the Middle East.

Supply chains for critical chipmaking materials are under examination. Helium, essential for cooling during lithography, relies heavily on production from Qatar. An extended closure of the Strait of Hormuz could remove more than a quarter of global supply from the market, according to industry consultant Phil Kornbluth. Bromine, used in circuit etching, is primarily sourced from Israel and Jordan. While current disruptions are minimal, analyst Ray Wang notes that prolonged hostilities could eventually hinder manufacturing operations.

The regional instability also casts doubt on ambitious digital infrastructure projects. A recent push by Gulf states to attract international investment, partly to align with U.S. strategic interests, had drawn major commitments from firms like Nvidia, Microsoft, and OpenAI. However, Iranian retaliatory strikes early in the conflict caused data center outages, disrupting financial and consumer services. This has intensified focus on security.

Patrick J. Murphy of Hilco Global suggests that if geopolitical risk escalates, companies might prioritize building new capacity in Northern Europe, India, or Southeast Asia, where conditions are more predictable. While a full-scale retreat from the region is unlikely, think tank analyst Tess deBlanc-Knowles indicates firms may hedge by slowing new investments or pausing partnership deals.

In other industry news: Meta introduced four custom AI chips; U.K. AI data center firm Nscale secured a $2 billion funding round; and Nvidia invested in Mira Murati's Thinking Machines Lab. Revolut obtained a full U.K. banking license, and Oracle's stock rose following strong quarterly results.

Source: CNBC