4 Semiconductor Stocks to Grab as Sales Hit $1 Trillion for First Time
Semiconductor stocks have been the market’s darling over the past few years. Enthusiasm surrounding artificial intelligence (AI), especially generative AI, has been providing a major boost to chip stocks, making them one of the most lucrative buys.
This year has been exceptionally impressive for the semiconductor industry, with sales surging at a rapid pace. As the massive investment in AI infrastructure continues, the future looks brighter for the semiconductor industry.
Given the optimism, it would be ideal to invest in semiconductor stocks, such as Taiwan Semiconductor Manufacturing Company Limited TSM, Analog Devices ADI, NVIDIA Corporation NVDA and MACOM Technology Solutions Holdings, Inc. MTSI, which have great potential for growth this year.
Semiconductor Sales Hit $1 Trillion
Global semiconductor sales totaled $159.7 billion in August, increasing 8% sequentially from July’s total of $147.9 billion, the Semiconductor Industry Association (“SIA”) reported earlier this week. Year over year, semiconductor sales soared 144.3% from August 2025 total of $65.4 billion.
More importantly, global semiconductor sales surpassed $1 trillion through August for the first time in history. SIA projects sales to hit more than $1.6 trillion by the end of 2026.
Michael Robbins, SIA president and CEO, said, “The global semiconductor market grew for the 18th consecutive month in August, with sales into the Americas, the Asia Pacific, and China driving strong and sustained year-to-year growth.”
Semiconductor sales have now grown in all the first eight months of the year. Earlier this year, investors grew concerned about whether the sky-high AI stocks and the rapid growth could be sustained, which put pressure on chip stocks.
However, those concerns were short-lived as robust investments by big tech companies have reinstated faith in the potential of AI. Major semiconductor companies tied to the AI boom delivered impressive quarterly results and offered upbeat forecasts, easing concerns and helping push chip stocks higher once again.
Semiconductor stocks have been a key contributor to the broader market’s gains in recent years. The strong performance in August came after an exceptional first half of 2026 for the sector. Global semiconductor sales reached $403.3 billion in the second quarter of 2026 and $298.5 billion in the first quarter, representing sequential increases of 33.1% and 25%, respectively.
Chips have become critical to a wide range of existing and emerging technologies, supporting advances in areas including the Internet of Things, 6G connectivity and AI.
Growing demand from the automotive sector has also provided a boost to semiconductor sales. Meanwhile, the AI industry remains in the early stages of its expansion, encouraging leading technology companies to commit billions of dollars to AI research, development and infrastructure.
4 Semiconductor Stocks With Upside
Taiwan Semiconductor Manufacturing Company Limited
Taiwan Semiconductor Manufacturing Company Limited is the world's largest dedicated integrated circuit foundry. TSM manufactures ICs for its customers based on their proprietary IC designs using its advanced production processes. Taiwan Semiconductor Manufacturing Company Limited’s goal is to establish itself as one of the world's leading semiconductor companies by building upon the strengths that have made it the world's leading IC foundry.
Taiwan Semiconductor Manufacturing Company Limited’s expected earnings growth rate for the current year is 55.5%. The Zacks Consensus Estimate for current-year earnings has improved 0.7% over the past 60 days. TSM presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Analog Devices
Analog Devices is an original equipment manufacturer of semiconductor devices, specifically analog, mixed-signal and digital signal processing (“DSP”) integrated circuits. ADI’s product line comprises amplifiers and comparators; analog-to-digital converters; digital-to-analog converters; video encoders and decoders; embedded processing products and DSPs; MEMS and temperature sensors; RF/IF components and converters; power and thermal management ICs, audio/video converters, amplifiers, CODECs, filters and processors. Analog Devices also offers analog, digital and RF switches and multiplexers; analog microcontrollers; clock and timing products.
Analog Devices’ expected earnings growth rate for the current year is 66.4%. The Zacks Consensus Estimate for current-year earnings has improved 4.3% over the past 60 days. ADI currently carries a Zacks Rank #1.
NVIDIA Corporation
NVIDIA Corporation is the worldwide leader in visual computing technologies and the inventor of the graphics processing unit, or GPU. Over the years, NVDA’s focus has evolved from PC graphics to AI-based solutions that now support high-performance computing, gaming and virtual reality platforms.
NVIDIA has an expected earnings growth rate of 93.9% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 4% over the last 60 days. NVDA currently has a Zacks Rank #1.
MACOM Technology Solutions Holdings
MACOM Technology Solutions Holdings is a provider of power analog semiconductor solutions to varied markets. MTSI develops and produces analog radio frequency, microwave and millimeter wave semiconductor devices and components for applications in optical, wireless and satellite networks. MACOM Technology Solutions Holdings primarily serves three markets, namely, data center, industrial & defense and telecom.
MACOM Technology’s expected earnings growth rate for the current year is 58.8%. The Zacks Consensus Estimate for current-year earnings has improved 6.8% over the past 60 days. MTSI presently has a Zacks Rank #1.
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NVIDIA Corporation (NVDA) : Free Stock Analysis Report
Taiwan Semiconductor Manufacturing Company Ltd. (TSM) : Free Stock Analysis Report
MACOM Technology Solutions Holdings, Inc. (MTSI) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
