NEW YORK, Dec. 27, 2025, 12:22 p.m. ET — Market closed
Semiconductor stocks head into the final week of 2025 with a familiar mix of tailwinds and headline risk: AI-driven demand remains the sector’s dominant narrative, but supply-chain sensitivity is back in focus after a Taiwan earthquake prompted limited evacuations at Taiwan Semiconductor Manufacturing Co. (TSMC). With U.S. stock exchanges closed for the weekend, investors are using the pause to re-price the next set of catalysts that will hit when trading resumes Monday. [1]
Where chip stocks left off: a quiet Friday, but semis held up
Friday’s post-Christmas session was light on volume and heavy on year-end positioning. Wall Street finished near record levels but essentially flat, as traders weighed seasonality, profit-taking, and the lack of fresh macro catalysts. [2]
For semiconductor investors, the notable takeaway was relative resilience. The Philadelphia Semiconductor Index (SOX) ended Dec. 26 at 7,207.6, up 0.05% on the day. [3]
The widely watched VanEck Semiconductor ETF (SMH), a proxy for broad chip equity exposure, closed Friday at $365.86, up 0.46%, and was little changed in after-hours pricing. [4]
While the major U.S. benchmarks edged down by less than 0.1%, the bigger picture remains bullish heading into the last trading days of the year: the S&P 500 is up sharply year-to-date and the Nasdaq has led the pack, reflecting continued leadership from mega-cap technology and AI-linked stocks. [5]
The headline that moved the group: Nvidia and Groq go “non-exclusive” on inference
The week’s most-talked-about semiconductor story has been Nvidia’s deal with AI inference specialist Groq—a move investors are reading as both strategic adaptation and competitive acknowledgment.
Reuters reported Nvidia gained on Friday after agreeing to license chip technology from Groq and hire its CEO, reinforcing the idea that Nvidia is intent on widening its playbook beyond GPUs as inference workloads scale. [6]
The agreement is non-exclusive and is structured as a licensing and talent move rather than a traditional acquisition. In Groq’s own announcement, the company said it entered a non-exclusive licensing agreement with Nvidia for Groq’s inference technology, and that Groq founder Jonathan Ross and Groq President Sunny Madra (along with other team members) would join Nvidia, while Groq continues operating independently under CEO Simon Edwards. [7]
Investopedia’s recap emphasized the market impact and the uncertainty around deal size, noting Nvidia said, “We haven’t acquired Groq,” even as reports swirled about asset purchases. [8]
One line that’s resonated with investors watching the inference arms race: Ross previously argued that “Inference is defining this era of AI.” [9]
Why it matters for semiconductor stocks (not just Nvidia):
- If inference becomes a bigger share of AI compute, it can reshape demand across accelerators, networking, memory, and advanced packaging.
- It also raises new questions about margin mix, especially if the market shifts toward more specialized silicon and heterogeneous server architectures.
Barron’s framed the Groq partnership as a defensive move in a world where hyperscalers increasingly build custom inference chips, warning that the pivot toward inference-optimized solutions could pressure Nvidia’s industry-leading margins over time. [10]
Analyst reaction has been mixed. An Investing.com roundup cited D.A. Davidson analyst Alex Platt as expressing confusion about the rationale, while it also pointed to more supportive takes from other firms and reiterated bullish ratings and price targets from multiple shops. [11]
Weekend risk check: Taiwan quake puts TSMC back in the spotlight
The semiconductor market’s sensitivity to operational disruptions is one reason TSMC headlines can move global chip stocks even when U.S. exchanges are closed.
On Saturday, Reuters reported that after an earthquake, a small number of TSMC facilities in the Hsinchu Science Park met evacuation criteria. TSMC said it prioritized employee safety, conducted evacuations and headcounts per emergency procedures, and that work safety systems were operating normally. [12]
A separate Reuters report on the broader earthquake said the quake was felt across Taiwan, with authorities warning of possible aftershocks, and noted that evacuated staff had returned to their posts. [13]
What investors should watch into Monday:
- Whether TSMC provides additional color on tool status, wafer-in-process impacts, or production normalization timelines.
- How the incident affects sentiment toward other supply-chain bottlenecks—especially in advanced nodes and AI-related capacity.
Because TSMC sits at the center of the AI hardware stack (supplying leading-edge manufacturing for many high-performance chips), even small operational uncertainty can quickly ripple into U.S.-listed semiconductor names tied to AI accelerators, smartphones, and data centers.
China’s capital push: new venture funds target integrated circuits
Geopolitics and industrial policy remain a persistent factor in semiconductor valuations—especially for companies exposed to China demand, export controls, or localized competition.
Reuters reported China launched three venture capital funds to invest in “hard technology,” with targets including integrated circuits (semiconductor chips). Each fund is planned at more than 50 billion yuan, and the initiative focuses on early-stage startups. [14]
For investors, that headline reinforces two simultaneous realities:
- China is continuing to build domestic chip capability through capital formation and industrial policy.
- The global semiconductor landscape remains a moving target, with long-cycle implications for competition, equipment demand, and supply-chain diversification.
The forward-looking signal: equipment spending forecasts stay strong, led by AI and HBM
If semiconductor stocks are discounting the next 12–24 months, one of the most important “macro” signals is the capital spending cycle—particularly in wafer fab equipment (WFE), test, and advanced packaging.
A new SEMI forecast expects wafer fab equipment sales to grow 11% in 2025 to $115.7 billion, citing stronger-than-expected investment in DRAM and high-bandwidth memory (HBM) to support AI computing. SEMI also projects continued growth into 2026 and 2027, with WFE reaching $135.2 billion as device makers spend on advanced logic and memory. [15]
SEMI’s leadership explicitly tied sustained investment to the industry’s expanding role, with SEMI President and CEO Ajit Manocha pointing to the “vital role” of semiconductor manufacturing investment in supporting innovation. [16]
Why this matters for chip stocks:
- Strong equipment and packaging demand tends to support earnings visibility for semiconductor equipment makers and key suppliers.
- It also signals confidence that the AI buildout is not just a short-term inventory cycle, but a multi-year capacity and architecture transition.
What investors should know before the next session
With U.S. exchanges closed today, the next major “price discovery” moment for semiconductor stocks is Monday’s premarket and regular session.
1) Know the trading timetable
Nasdaq’s standard hours are 9:30 a.m. to 4:00 p.m. ET, with extended trading generally listed as 4:00 a.m. to 9:30 a.m. ET (premarket) and 4:00 p.m. to 8:00 p.m. ET (after-hours). [17]
2) Track the next macro prints that can move tech multiples
Even when the semiconductor newsflow is company-specific, the group remains highly sensitive to rates and broad risk appetite. The New York Fed’s U.S. economic calendar shows several releases on Monday, Dec. 29 (all ET), including:
- Advance International Trade in Goods (8:30 a.m.)
- NAR Pending Home Sales Index (10:00 a.m.)
- Dallas Fed Manufacturing Survey (10:30 a.m.)
- R-star estimates (2:00 p.m.) [18]
These aren’t classic “chip demand” data points, but they can influence bond yields and equity-duration sentiment—often a key driver for high-multiple semiconductor leaders.
3) Watch the “Santa Claus rally” tape and year-end liquidity
Reuters quoted Carson Group chief market strategist Ryan Detrick describing the market as “catching our breath” after a strong run, while noting the seasonal “Santa Claus rally” window extends into early January. Thin liquidity can amplify moves in high-beta semiconductor stocks on incremental headlines. [19]
4) Pay attention to the calendar around New Year’s
Investopedia notes stock trading continues with a full session on New Year’s Eve (Wednesday, Dec. 31), while stock and bond markets are closed on Thursday, Jan. 1, 2026 for New Year’s Day. [20]
SIFMA’s schedule also highlights an early close at 2:00 p.m. ET for the bond market on Dec. 31. [21]
Bottom line for semiconductor stock watchers this weekend
Semiconductor stocks enter the final sessions of 2025 with bullish structural drivers—AI infrastructure, HBM-led memory spending, and multi-year equipment investment forecasts—colliding with very real near-term headline sensitivity.
Between Nvidia’s inference push via Groq, TSMC’s operational update after the Taiwan quake, and China’s renewed capital commitment to integrated circuits, Monday’s open sets up as a test of whether semiconductors can extend their year-end resilience while the broader market navigates thin liquidity and the last macro catalysts of the year. [22]
References
1. www.reuters.com, 2. www.reuters.com, 3. www.investing.com, 4. www.investing.com, 5. apnews.com, 6. www.reuters.com, 7. groq.com, 8. www.investopedia.com, 9. www.investopedia.com, 10. www.barrons.com, 11. www.investing.com, 12. www.reuters.com, 13. www.reuters.com, 14. www.reuters.com, 15. www.semi.org, 16. www.semi.org, 17. www.nasdaq.com, 18. www.newyorkfed.org, 19. www.reuters.com, 20. www.investopedia.com, 21. www.sifma.org, 22. www.reuters.com
