US chipmakers hit record highs as Intel turbocharges AI rally

April 24 : U.S. chip stocks soared to record highs on Friday, with Intel’s unexpectedly strong revenue forecast fueling fresh optimism that the AI boom driving this year’s rally in the semiconductor sector is showing no signs of slowing down.

The foremost stock index for chip makers – the Philadelphia SE Semiconductor Index – rose 2.5 per cent to an all-time high and was on track to extend its record-breaking streak of single-day gains to 18. The index has gained more than 42 per cent so far this year.

Chip stocks have emerged as some of the biggest gainers of the spending spree by tech giants on scaling up their AI infrastructure.

“The AI build-out race is still on. We are seeing solid results, especially for semiconductors and no sign that demand for AI is slowing down,” said Angelo Kourkafas, senior global investment strategist at Edward Jones.

The semiconductors sub-industry alone is expected to record first-quarter earnings growth of 104.9 per cent – much higher than the broader S&P 500 information technology sector whose earnings growth is seen at 46.2 per cent, according to LSEG I/B/E/S data.

Intel surged 22.3 per cent to surpass its dotcom-era peak in 2000 following a robust revenue outlook that signaled strong demand for central processors (CPUs), with rivals AMD and Arm also climbing 11.8 per cent and 8.1 per cent, respectively.

Nvidia, now the world’s most valuable company, rose 1.2 per cent. Much of last year’s rally in chip stocks was driven by Nvidia, whose gains were fueled by strong demand for its flagship graphics processing units (GPUs).

U.S. tech stocks also seemed to shrug off a preview of a new AI model from Chinese startup DeepSeek, whose low-cost AI model rocked Wall Street last year.

“Over time, people have come to realize that actually they’re not the threat that they seemed to be. The market’s saying, ‘Hang on, we’re not going to be bitten twice with this,'” said David Morrison, senior market analyst at Trade Nation, referring to the threat from DeepSeek.

The Philadelphia chips index was last trading at around 26.6 times its 12-month forward earnings estimates, compared to around 20.7 for the S&P 500.

Analog chipmaker Texas Instruments also forecast second-quarter revenue and profit above estimates on Wednesday, sending its shares to a record high. It was last down 2.4 per cent on Friday.