Alger
September 14, 2022
Alger is widely recognized as a pioneer of growth-style investing.

Chips Ahoy!

The Internet of Things promises major advancements in productivity and convenience. To enable that future, the world will require increased production from one industry in particular: semiconductors.

  • The semiconductor industry produced 1.1 trillion chips for a $590 billion worldwide market last
  • year. That market is set to grow to $940 billion by 2030, according to estimates from ASML, a
  • maker of sophisticated semiconductor equipment.
  • The data estimates the three fastest growing areas of semiconductors based on compound
  • annual growth rates (CAGR) include:
    • 1. Autos , which are increasingly becoming digital and turning into computers on wheels
    • 2. Data Centers , which help run applications in the cloud and
    • 3. Industrial demand for artificial intelligence on big data and sensors.
  • We believe that the projected growth in this market makes the group of companies that produce
  • the equipment that churns out the chips very attractive. These are the companies that provide
  • chipmakers with hardware, software, and services necessary to keep the industry moving forward
  • and ultimately enable the Internet of Things.

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