unexpected ai boom fuels surge in nvidia and tsmc stocks

2025-02-13 general

Taiwan, Thursday, 13 February 2025.
A burgeoning interest in artificial intelligence is propelling semiconductor stock values to unprecedented heights. Companies like NVIDIA and Taiwan Semiconductor Manufacturing Company (TSMC) are leading this charge. Their technologies play a pivotal role in driving AI advancements. As a result, investor confidence in these firms has markedly increased. This trend is reflected in the Philadelphia Semiconductor Index, which recently reached a new peak. The AI-demand boom is further pushing the information technology sector, with reported gains of over 28% in 2024. Semiconductor stocks like NVIDIA and TSMC saw sharp increases, with NVIDIA’s share price jumping by 171.25% and TSMC’s by 92.56%. This surge is attributed to growing AI demand, notably in automotive and data center applications, alongside improved supply chains post-pandemic shortages. The semiconductor market’s robust performance highlights a dynamic shift towards AI-driven solutions.

Market performance and key indicators

The Philadelphia Semiconductor Index (SOX) demonstrates the sector’s exceptional performance, reaching a peak of 5,931 points in July 2024 [1]. The information technology sector’s remarkable growth is evidenced by a 28.26% surge in 2024 [1]. Leading this charge, NVIDIA’s stock value increased by 171.25%, while TSMC recorded gains of 92.56% [1]. These gains stem from increased demand for AI technologies across various sectors [1].

AI-driven demand expansion

Industry experts project continued growth in AI-related semiconductor demand. TrendForce predicts that global AI server shipments will increase by approximately 28% in 2025 [6]. Major cloud service providers like Microsoft, Meta, Amazon, and Google have announced plans to expand their AI infrastructure capital expenditure by over 30% [6]. This expansion directly benefits semiconductor manufacturers who supply essential components for AI computing systems [1].

Industry outlook and production trends

The semiconductor industry shows strong growth potential, with the Semi Industry Association (SIA) reporting that 2024 marked a historic milestone as global semiconductor sales exceeded $600 billion for the first time [6]. Logic products led sales at $212.6 billion, while memory products saw a dramatic 78.9% increase, reaching $165.1 billion [6]. DRAM products particularly stood out with an 82.6% growth rate, the highest among all semiconductor categories [6].

Strategic industry developments

Major tech companies are strengthening their positions in the AI semiconductor space. Meta is considering acquiring Korean AI semiconductor startup FuriosaAI [2], while NXP has announced a $307 million acquisition of edge AI NPU company Kinara [2]. These strategic moves reflect the industry’s rapid consolidation and expansion in response to growing AI demands [2][3].

Global investment momentum

The AI semiconductor sector is attracting significant global investment. The European Union has proposed a €200 billion AI investment initiative [3], while France has announced plans to invest over €109 billion in AI projects [3]. South Korea has launched new support programs for AI semiconductor companies to boost international exports [4]. These investments signal strong governmental backing for AI semiconductor development [3][4].

Bronnen

Semiconductor AI boom