Shares across the semiconductor industry rallied on Wednesday, propelled by strong earnings reports that signalled the artificial intelligence (AI) investment boom is widening beyond suppliers of advanced processors like Nvidia. The surge reflects growing demand for the full spectrum of data centre hardware needed to power AI infrastructure.
The upbeat momentum was led by Texas Instruments, whose shares rose about 8.5% after the company — a maker of essential analogue chips for power management — issued a rosy forecast. This indicates that the capital expenditure wave is benefitting a broader range of component suppliers. Storage firm Seagate jumped 17.7% after raising its outlook, citing fully booked production capacity through 2026. While European equipment leader ASML pared earlier gains, its quarterly orders came in nearly double the estimates, pointing to massive planned investments by chipmakers.
Sector sentiment was further supported by a report that China approved its top tech firms to purchase high-end AI chips from Nvidia, easing immediate trade tension concerns. Analysts highlighted that improving confidence across corporate supply chains is translating into firm spending plans for technology, with the semiconductor sector poised for disproportionate growth.
However, the rally exists alongside persistent softness in consumer electronics markets like smartphones and PCs, which remain pressured by an earlier memory chip shortage. While the industrial and data centre segments show strength, this divergence creates a mixed demand landscape for some chipmakers.
The sentiment is strongly positive, with a shift toward broader, ecosystem-wide confidence. The exceptional results from companies like Texas Instruments, ASML, and Seagate provide concrete evidence that AI-driven capital expenditure is now permeating the entire semiconductor value chain, from equipment and components to storage. This suggests a more mature and sustained infrastructure build-out phase. The primary cautions stem from the continued weakness in the consumer end-market, which creates a bifurcated industry outlook, and the ever-present overhang of geopolitical and trade policy risks.
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