Semiconductor stocks record strongest annual gains since 2009

Semiconductor stocks posted their best annual performance in more than a decade, driven by the rise in shares of chip producers seen as the most beneficiaries of artificial intelligence.

The Philadelphia Stock Exchange index of semiconductor companies rose 65% this year, marking the largest annual gain since 2009, when it climbed 70% after reaching its lows in the wake of the financial crisis.

The index fell 0.8% on Friday, the last trading day of the year, close to record highs.

All but one of the 30 companies on the index rose in 2023, and among the gainers, NVIDIA saw a steady increase in sales amid demand for chips used to power AI computing operations. The share price more than tripled, resulting in NVIDIA winning the title of the first chip company with a market capitalization exceeding $1 trillion.

Advanced Micro Devices (AMD) is the second-largest company on the index and another major AI player, and its stock has risen more than 130% this year.

The only company to tweet out of the flock among chip makers was Wolfspeed, which lost more than a third of its market value this year.