Semiconductor stocks surged on Tuesday - along with the broader markets - as a key Apple (NASDAQ:AAPL) manufacturing partner said it is "cautiously optimistic" on the fourth-quarter and memory chip maker Micron (NASDAQ:MU) said it would spend up to $100B on a new facility in upstate New York.
Apple (AAPL) supplier Foxconn (OTCPK:HNHPF) said it was "cautiously optimistic" about the all important period after it reported record September sales. Total revenue during the month rose 40.4% year-over-year and 82.3% month-over-month to $25.9B due to “new product launch and smooth mass production.”
However, Foxconn (OTCPK:HNHPF) added that "the dynamics of inflation, the pandemic, and the supply chain still need to be closely monitored."
Apple (AAPL) shares gained nearly 2% in mid-day trading.
A number of Apple (AAPL) suppliers, notably, STMicroelectronics (NYSE:STM) and Infineon (OTCQX:IFNNY), saw sharp gains on back of a report that the European Union will force consumer electronics makers to standardize USB-C charging for devices as soon as 2024.
Micron Technology (MU) gained more than 5% to $54.48 after it said it would spend up to $100B on a massive new chipmaking facility in upstate New York, another sign that new federal investments are spurring domestic investment in the semiconductor industry.
Micron (MU) said its new project in Clay, New York will involve 20 years of investments and construction in the chipmaking complex.
The investment by the Boise, Idaho-based Micron (MU) comes less than two months after President Joe Biden signed the CHIPS and Science Act of 2022, which provides $52B in federal grants and subsidies for chip companies to build more domestic factories and facilities.
Micron (MU) Chief Executive Sanjay Mehrotra said the CHIPS Act was directly responsible for his company's New York factory plans.
Separately on Tuesday, Samsung (OTCPK:SSNLF) said it would triple the amount of advanced chips it produces in the next five years as the South Korean electronics giant looks to meet strong demand unmoved by the weakening global economy.
The electronics giant, which produces chips for a number of clients, including Nvidia (NVDA), Qualcomm (QCOM) and Tesla (TSLA), among others, said it hoped to have mass production of 2 nm chips by 2025 and 1.4 nm chips by 2027.
Other semiconductor stocks also saw strong gains on Tuesday, including Texas Instruments (TXN), Analog Devices (ADI), NXP Semiconductors (NXPI) and ON Semiconductor (ON), all of which gained 4% or more.
Last week, Micron (MU) offered up a disappointing quarterly forecast and said it would cut its capital spending plans next year.