In 2025, VanEck Semiconductor ETF (NASDAQ: SMH) rallied 48.7%, led by strong performances from key holdings like Micron (NASDAQ: MU), Taiwan Semiconductor Manufacturing (NYSE: TSM), Broadcom (NASDAQ: AVGO), and Advanced Micro Devices (NASDAQ: AMD). The AI boom drove demand for memory, with DRAM and NAND prices spiking. The future looks promising for the semiconductor sector, but risks include OpenAI’s massive spending plans and potential AI progress setbacks. Despite these concerns, industry leaders expect continued growth, making SMH a potential outperformer in 2026. (Word count: 74)

The ETF’s top holdings include Nvidia (NASDAQ: NVDA), which underperformed the overall ETF in 2025, and Micron, a major contributor to the ETF’s outperformance. The semiconductor sector’s AI infrastructure boom continues to drive earnings growth, supporting high valuations. However, risks tied to OpenAI’s spending plans and AI progress could impact future performance. While industry leaders remain optimistic about AI’s transformative potential, investors should consider these risks before buying VanEck Semiconductor ETF stock. (Word count: 71)

Read more at Nasdaq: Why The VanEck Semiconductor ETF Rallied Almost 50% in 2025