In a strategic pivot, Cathie Wood’s Ark Invest has been aggressively buying shares in semiconductor powerhouses AMD and Taiwan Semiconductor, signaling a move beyond speculative AI names to the core infrastructure of the revolution.
NEW YORK – Cathie Wood, the influential CEO of Ark Invest known for her high-conviction bets on disruptive and often volatile innovators like Tesla and Palantir, is making a significant move into the foundational layer of the artificial intelligence boom: semiconductor stocks.
Over the last several months, Ark Invest has quietly but aggressively been accumulating large positions in chip designer Advanced Micro Devices (NASDAQ: AMD) and the world’s leading chip manufacturer, Taiwan Semiconductor Manufacturing (NYSE: TSM). This shift indicates a broadening of Ark’s AI strategy, complementing its software and speculative plays with the essential hardware that powers them.
The High-Stakes Bet on AMD
Ark Invest’s interest in AMD has ramped up considerably. Between June 17 and June 30 alone, the firm snapped up approximately 800,000 shares of AMD across four of its flagship ETFs. This buying spree has elevated AMD to become the 11th largest position in Ark’s entire portfolio.
The move coincides with a powerful rally in AMD’s stock, which has gained roughly 61% since Ark began its recent accumulation in late April. This momentum is largely attributed to AMD’s accelerating data center business and bullish anticipation for its new AI accelerator chips set to compete with Nvidia.
Despite the sharp run-up, AMD trades at a forward price-to-earnings (P/E) ratio of around 36, a valuation that, while not cheap, is within its historical range. However, the primary risk for investors remains the colossal competitive threat posed by Nvidia, the undisputed king of the AI chip industry.
The ‘Picks and Shovels’ Play: Taiwan Semiconductor (TSMC)
In a complementary move, Ark also doubled down on its TSMC position, adding over 190,000 shares in June. This bet represents a different, and potentially more strategic, angle on the AI market.
Unlike AMD or Nvidia, TSMC does not design its own chips. Instead, as the world’s premier chip foundry, it manufactures the advanced semiconductors designed by nearly every major tech company. This unique “picks and shovels” position means TSMC stands to benefit from the massive global investment in AI infrastructure, regardless of which company ultimately wins the chip design war. An investment in TSMC is effectively a bet on the entire data center and AI buildout.
Concerns for TSMC are less about competition and more about the geopolitical tensions surrounding Taiwan and China. However, with the company making significant investments in geographic diversification and trading at a reasonable forward P/E of 25, many analysts believe these risks are already priced into the stock. This has led some to label TSMC as potentially “the best bargain in the AI market right now.”
A Maturing AI Strategy
Cathie Wood’s two-pronged investment in the semiconductor space signals a maturing AI thesis. By betting on both a direct competitor to the market leader (AMD) and the foundational manufacturer for the entire industry (TSMC), Ark is ensuring it has exposure to every level of the AI hardware stack. This move beyond its traditional speculative comfort zone could mark a new chapter for one of Wall Street’s most-watched investors.
