Memory-Cycle Doubts Meet AI Earnings Boom in This Semiconductor ETF
Published on 09/24/2026 at 19:53 | Editorial boerse-global.de
The iShares MSCI Global Semiconductors UCITS ETF USD Acc finds itself caught between two competing narratives this week, and the price action reflects the tug-of-war. The fund slipped 1.7% on Thursday to EUR 18.29, surrendering a slice of its recent gains as a high-profile short bet against memory chips collided with rising bond yields that weighed on technology names across the board.
At the center of the bearish case is investor Michael Burry, who has enlarged short positions against Micron, Russian AI-cloud provider Nebius, data-analytics firm Palantir and the US chip ETF SOXX. His thesis holds that the current memory-chip shortage is a temporary condition — production will normalize over the next two years and the memory cycle will swing back into negative territory. Acer chief executive Jason Chen has lent support to that view, telling Taiwanese media that Chinese memory capacity keeps expanding, with DDR4 chips now seeing more sellers than buyers. Burry went further, warning that memory-chip makers are trading at "ridiculous prices" and could face "intense" selling. He favors chip suppliers instead, recommending short positions in Applied Materials and Lam Research as well.
The skepticism extends beyond one investor. Sujai Shivakumar, an economist at the CSIS think tank, argued in a paper that Chinese overcapacity in DRAM and NAND could become the memory market's next major risk, raising the prospect of dumping and fresh trade conflicts.
A Six-Day Streak Comes to a Halt
The Philadelphia Semiconductor Index had climbed for six consecutive sessions, gaining 14% in total on renewed confidence in AI and memory-chip makers, before reversing 1.2% on Wednesday. Despite that recovery, BTIG strategist Jonathan Krinsky notes the index remains 14% below its June peak. Only three of its 30 members — AMD, Nvidia and Taiwan Semiconductor — sit closer to their own record highs than the broader gauge. Ten components trade more than 30% below their 52-week highs, among them GlobalFoundries, KLA and On Semiconductor, each off by over 40%.
The pullback in chip stocks coincided with a wider selloff on US markets. Rising Treasury yields — the 10-year note touched its highest level since July 2007 — and a growing probability of another Fed rate hike in October pressured technology shares on Wednesday. The Nasdaq Composite shed roughly 1.1%, just a day after setting an all-time high.
Earnings Tell a Different Story
Against that cautious market backdrop stands a markedly more optimistic fundamental picture. A report from Bernstein analyst Stacy Rasgon shows that earnings estimates for the semiconductor sector have been revised upward by 113% since the start of the year, while valuations cheapened by around 18% over the same stretch. The sector's valuation premium to the S&P 500 has narrowed from roughly 62% to about 17%. Rasgon maintains "Outperform" ratings on Nvidia, Broadcom and AMD, as well as on equipment makers Applied Materials, KLA and Lam Research.
The fund's key holdings have been delivering results that back up that optimism. Broadcom reported AI semiconductor revenue of USD 16.7 billion for its third fiscal quarter of 2026 (ended August 2), a jump of 221% year over year. Micron Technology outpaced even that pace: the memory maker posted USD 41.5 billion in revenue for its third fiscal quarter, more than quadruple the prior-year figure, and guided toward roughly USD 50 billion for the fourth quarter.
Advanced Micro Devices, another heavyweight in the portfolio, also made headlines. The stock leapt 10% after Bloomberg reported early success for a new AI agent from Meta Platforms, sparking investor enthusiasm about AI infrastructure utilization.
That upbeat mood has carried through much of the chip industry and is visible in the ETF's performance: the fund is up 94% year to date and 127% over twelve months, underscoring how heavily it has benefited from the sector's AI-driven boom.
Volatility Is Here to Stay
The rally has not been without setbacks. Back in mid-September, concerns about the development of new AI models triggered a selloff in the technology sector that also dragged on the Nasdaq and briefly hit the semiconductor holdings in the fund. Given the ETF's tight coupling to a handful of large AI beneficiaries, such swings are unlikely to be isolated events.
A structural shake-up may also be on the horizon. MSCI and S&P Dow Jones Indices are reviewing, as part of a consultation running until October 30, whether to split the semiconductor sub-industry by business model — design versus manufacturing, for instance. The rationale: companies like Broadcom, AMD and Intel increasingly report mixed segments, making a clean classification by chip type difficult. Results are expected by November 2026 and could alter the composition of the underlying index the ETF tracks — the MSCI ACWI IMI Semiconductors & Semiconductor Equipment ESG Screened Select Capped Index.
For now, the fund sits in a mixed position. Near-term, rate worries and doubts about the memory-chip cycle are weighing on the quote, which is currently 15% below its 52-week high of EUR 21.52. The longer-term uptrend remains intact, with the price still 25% above its 200-day moving average and more than doubled since its yearly low last September. For holders of the accumulating fund, which makes no distributions, the fundamental trajectory of its core positions remains the decisive driver. As long as companies like Broadcom and Micron keep posting AI-fueled growth rates, the index is likely to stay closely tied to the AI investment cycle — with all the upside and volatility that entails.
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