Semiconductors are the foundation of modern industries, driving innovation and economic growth. In 2023, the global semiconductor market generated $500 billion in revenue and is projected to grow at a robust CAGR of 11.8%, reaching $981 billion by 2029.
These essential components power electric vehicles, smart electronics, computing devices, and 5G networks, making them indispensable across industries.
Governments worldwide are investing heavily to strengthen semiconductor R&D and manufacturing, with initiatives like the U.S. CHIPS Act ($280B), the EU's €43B Chips Act, and China's $48B Big Fund aimed at enhancing supply chain resilience and fostering innovation.
Meanwhile, surging demand and geopolitical tensions have driven unprecedented mergers and acquisitions, as companies secure advanced technologies and accelerate innovation.
For investors, the iShares Semiconductor ETF offers diversified exposure to leading companies in the semiconductor sector. Delivering a 24% annualized return over five years, significantly outperforming the S&P 500’s 14%, it provides strong growth potential.