Memory Revenues to Nearly Triple in 2026: Semiconductor ETFs to Buy

The global semiconductor market enters a historic growth phase, with revenues expected to exceed $1 trillion in 2026, fueled primarily by rising investments in AI infrastructure, according to a recent report published by the International Data Corporation (“IDC”). The report projects global semiconductor revenues to climb 53% year over year to $1.29 trillion in 2026.At the heart of this extraordinary surge is the memory segment, where DRAM revenues alone are expected to nearly triple to $418.6 billion as hyperscalers and AI infrastructure providers race to secure high-bandwidth memory (HBM) and next-gen DDR supplies.This turning point presents a remarkable opportunity for investors to gain exposure to the entire semiconductor value chain, and semiconductor exchange-traded funds (ETFs) offer a diversified and efficient way to do so.Before attempting to capitalize on the semiconductor market’s trillion-dollar expansion, investors need to understand the drivers behind this growth, particularly the critical role of memory in the semiconductor industry and how AI’s relentless computing demand is reshaping the sector’s trajectory.How AI Is Transforming the Role of Memory in the Chip IndustryMemory chips have evolved from cyclical commodities into strategic assets shaping the next phase of semiconductor profitability. DRAM and NAND markets, once driven primarily by consumer electronics, are now increasingly influenced by AI workloads that demand exponentially higher memory capacity and bandwidth.IDC projects global memory revenues to increase from $226 billion in 2025 to almost $595 billion in 2026 as hyperscalers ramp up purchases of premium, high-performance memory products over lower-cost, mass-market options.High-bandwidth memory (HBM), in particular, lies at the center of this boom. Every AI accelerator, whether produced by NVIDIA, AMD, or through custom in-house designs at cloud hyperscalers, relies on stacks of HBM to sustain the massive data throughput required for model training and inference. This shift substantially boosts memory pricing, and the resulting profitability extends across the semiconductor ecosystem in a ripple effect. Since high-performance memory must be physically integrated with AI processors using complex packaging techniques, advanced packaging firms, logic chip manufacturers, and wafer equipment suppliers are all seeing record demand amid rising investments in AI infrastructure. In effect, AI has not only become a demand catalyst, but also the foundation of semiconductor demand, reshaping how capital, production, and pricing interact across the industry.Capturing the Opportunity Through Semiconductor ETFsConsidering the aforementioned discussion, one can understand how investing in individual memory chip stocks like Micron MU or SK Hynix, which often dominate headlines, may cause them to miss the broader opportunity to gain from the entire semiconductor ecosystem.Against this backdrop, semiconductor ETFs emerge as a more prudent choice for investors, as they provide exposure across leading chipmakers, equipment suppliers, and memory giants, offering broad access to the entire AI-driven semiconductor value chain.Further, these ETFs provide a diversified “basket” approach, allowing investors to benefit from the growth of the entire $1.29 trillion semiconductor sector while reducing the volatility associated with single-stock investments.To capitalize on the massive memory market explosion, investors may consider adding the following ETFs to their portfolios:iShares Semiconductor ETF SOXXThis fund, with net assets worth $34.37 billion, offers exposure to 30 U.S. companies that design, manufacture, and distribute semiconductors. Its top three holdings include: MU (with 9.77% weightage), Advanced Micro Devices AMD (9.15%), and Intel INTC (7.39%). SOXX has rallied 156.2% over the past year. The fund charges 34 basis points (bps) as fees. It sports a Zacks ETF Rank #1 (Strong Buy) and traded at a good volume of 7.48 million shares in the last trading session. Invesco Semiconductors ETF PSIThis fund, with a market value worth $2.34 billion, offers exposure to 30 U.S. semiconductor companies. Its top three holdings include MaxLinear (9.94%), AMD (7.09%) and MU (5.95%). PSI has surged 195% over the past year. The fund charges 56 bps as fees. It sports a Zacks ETF Rank #1 and traded at a good volume of 1.24 million shares in the last trading session. State Street SPDR S&P Semiconductor ETF XSDThis fund, with net assets worth $3.02 billion, offers exposure to 44 semiconductor companies. Its top three holdings include MaxLinear (7.41%), INTC (4.28%) and Sitime Corp. (3.91%). XSD has surged 152.8% over the past year. The fund charges 35 bps as fees. It holds a Zacks ETF Rank #1 and traded at a volume of 0.19 million shares in the last trading session. VanEck Fabless Semiconductor ETF SMHXThis fund, with net assets worth $234.3 million, offers exposure to 23 companies focused on semiconductor design and intellectual property. Its top three holdings include NVIDIA NVDA (15.89%), Broadcom (12.97%) and AMD (7.63%). SMHX has soared 111.9% over the past year. The fund charges 35 bps as fees. It holds a Zacks ETF Rank #2 (Buy) and traded at a volume of 0.13 million shares in the last trading session. Boost Your Portfolio with Our Top ETF Insights Zacks' exclusive Fund Newsletter delivers actionable information, top news and analysis, as well as top-performing ETFs, straight to your inbox every week. Don’t miss out on this valuable resource. It’s free!Get it now >>This article originally published on Zacks Investment Research (zacks.com).Zacks Investment Research