Chip stocks staged a strong rebound, clawing back losses from the prior session on signs of easing U.S.-China trade tensions and fresh deal activity tied to Artificial Intelligence. Semiconductors remain the primary beneficiaries of the Artificial Intelligence buildout, supplying the core compute needed for applications spanning smartphones, PCs, gaming, autos and hyperscale data centers. The rally also refocused attention on semiconductor exchange-traded funds, which the article notes rank among the best performers over the past decade.
The latest wave of megadeals is sizable. Nvidia and OpenAI unveiled a strategic partnership under which Nvidia will invest up to an unspecified amount in OpenAI to back new data centers with at least 10 gigawatts of power capacity. The article adds that the Trump administration approved some Nvidia chip exports to the United Arab Emirates. These developments underscore both the scale and geopolitical complexity of Artificial Intelligence infrastructure buildouts.
AMD shares jumped after announcing a multibillion-dollar agreement with OpenAI tied to data centers powered by AMD chips. Under the deal, OpenAI will purchase six gigawatts’ worth of AMD chips and receive about a 10 percent equity stake in AMD, to be granted in phases upon hitting certain milestones. While AMD has long been viewed as a distant second in the Artificial Intelligence chip market, the article notes Nvidia still dominates with more than a 75 percent share.
OpenAI also partnered with Broadcom to develop and deploy 10 gigawatts of custom Artificial Intelligence chips and computing systems over four years, with financial terms undisclosed. Separately, Intel received a boost as Nvidia invests an unspecified amount in the company. That follows the U.S. government’s 10 percent stake in Intel, which the article says has gained about 50 percent in value amid the stock’s rally. Both the Biden and Trump administrations have backed Intel to bolster domestic chip manufacturing. OpenAI estimates that bringing one gigawatt of capacity online costs an unspecified amount, with roughly two-thirds of the spend on chips, hardware and infrastructure, according to the Financial Times.
For investors seeking broader exposure to the theme, the article highlights VanEck Semiconductor ETF (SMH), iShares Semiconductor ETF (SOXX) and SPDR S&P Semiconductor ETF (XSD). With chipmakers supplying the picks and shovels of the Artificial Intelligence expansion and striking multi-gigawatt partnerships, these funds sit at the center of a fast-evolving semiconductor cycle tied to accelerated data center investment.
