Semiconductor Sector Experiences Significant Growth
Shares of the iShares Semiconductor ETF (NASDAQ: SOXX) rose 12% in January, driven by strong earnings from Taiwan Semiconductor Manufacturing Company (TSMC) and surging memory prices. The SOXX offers diversified exposure to 30 U.S.-based semiconductor companies, excluding major international players like TSMC and ASML. Notably, TSMC projected capital spending of $52 billion to $56 billion in 2026, which is a 40% increase from 2025.
Throughout the quarter, DRAM prices are expected to increase by up to 95%, and NAND flash prices by 60%, according to Trendforce. Micron (NASDAQ: MU), a major player in memory chips, rallied 45.6% in January as it became the ETF’s largest holding. Despite these gains, the SOXX has declined by 4.6% in February, attributed to Advanced Micro Devices (AMD) reporting less favorable earnings guidance.
The outlook remains cautiously optimistic, as capital spending forecasts from major cloud companies indicate continued investment in AI infrastructure, suggesting potential growth for semiconductor stocks beyond 2026.
