The semiconductor industry has been struggling with supply chain blockages that have disrupted production capabilities. However, major chip-making companies have been investing heavily to establish new production plants to boost the industry’s output. Also, several government initiatives have been launched to support the industry. The House of Representatives passed the CHIPS Act investments totaling $52 billion earlier this year, aiming to strengthen domestic semiconductor manufacturing and research. The legislation is now awaiting reconciliation with a Senate version
In addition, demand for semiconductors remains as strong as ever. According to Fortune Business Insights, the global semiconductor market is projected to grow at a CAGR of 9.2% from 2022 to 2029. Investors’ interest in the semiconductor industry is also evident in the VanEck Vectors Semiconductor ETF’s (SMH) 8% returns over the past month.
