VanEck Semiconductor ETF

SMH

Market cap $68.5B

After three years of hyperscaler capital spending feeding through to chip designers, foundry capacity, and lithography backlogs, the semiconductor ETF complex has separated into distinct buckets.

Thomas Poullaouec, Head of Global Investment Solutions, International at T.Rowe Price, says he does not foresee a slowdown in the demand for memory chips despite rising prices.

Huawei's new chip design principle focused on boosting transmission speed rather than continuing to shrink semiconductors offers a path for China to build cutting-edge chips ​despite U.S. sanctions, though whether it represents a true breakthrough remains to be seen.

Applied Materials CEO Gary Dickerson said the semiconductor industry is experiencing its strongest period ever. He said artificial intelligence is driving unprecedented computing demand and long-term growth.

High-bandwidth memory has become the choke point in the AI buildout, as NVIDIA's Blackwell accelerators rely on stacked DRAM modules that only three companies can produce at scale, and the order books for those modules are reportedly stretching past 2027.

Shares of chipmakers are rallying this year While the AI spending boom is fueling big gains for lots of tech companies, it's the semiconductor makers that are truly in the chips these days.

Ned Davis Research says the bubble argument for chips has some grounding, but that sector may also be looking at the start of a new supercycle.

Surging demand for chip makers has lifted major indexes from their wartime malaise.

Recent aggregate flow data reflects continued institutional participation across a broad range of sectors, with social media, software, aerospace, semiconductors, enterprise technology, transportation infrastructure, and leveraged ETFs all represented within TradePulse's Top Inflows dataset.

Japan's Nikkei 225 climbed to a record high on Wednesday, as a rally in semiconductor shares outweighed weakness in banks and real estate stocks. The benchmark index rose 1.25% to 65,811.78 as of 0147 GMT, after touching an intraday high of 66,428.81.