VanEck Semiconductor ETF (SMH) Holdings & Performance Recap

By Nick Frasse, Associate Product Manager

Review the top contributors and detractors that lead to the SMH ETF’s strong performance in Q2 2023.

SMH Performance Overview for Q2 2023

VanEck Semiconductor ETF has had strong performance in Q2 of 2023, up 15.78% over that time period. Performance was largely due to exposure to NVIDIA Corp. ($NVDA) and their exposure to the growing GPU demand for Artificial Intelligence models. Semiconductors continue to be a primary driver of technological innovation globally, whether its complex systems on a chip or basic memory and components, we believe the sector is a long term trend that investors should consider.

SMH Top Holdings

Daily Holdings (%) as of 08/31/2023
Ticker Holding Name % of Net Assets Identifier (FIGI) Shares Asset Class Market Value(US$) Notional Value
NVDA US Nvidia Corp 21.63 BBG000BBJQV0 4,476,165 Stock 2,209,211,236
TSM US Taiwan Semiconductor Manufacturing Co L 10.25 BBG000BD8ZK0 11,183,469 Stock 1,046,437,194
AVGO US Broadcom Inc 5.47 BBG00KHY5S69 605,864 Stock 559,145,827
LRCX US Lam Research Corp 4.79 BBG000BNFLM9 695,940 Stock 488,828,256
AMAT US Applied Materials Inc 4.71 BBG000BBPFB9 3,148,449 Stock 480,957,069
INTC US Intel Corp 4.68 BBG000C0G1D1 13,589,266 Stock 477,526,807
ASML US Asml Holding Nv 4.55 BBG000K6MRN4 702,784 Stock 464,209,916
TXN US Texas Instruments Inc 4.52 BBG000BVV7G1 2,745,990 Stock 461,491,079
ADI US Analog Devices Inc 4.17 BBG000BB6G37 2,356,637 Stock 426,362,766
AMD US Advanced Micro Devices Inc 4.15 BBG000BBQCY0 4,008,364 Stock 423,764,242

These are not recommendations to buy or to sell any security. Securities and holdings may vary.

Top Two Contributors for SMH in Q2 2023

NVIDIA Corp. (NVDA) – 15.86% Weight | 7.57% Contribution to return

In the second quarter, Nvidia exceeded expectations, achieving an EPS of $2.70 (surpassing predictions by 62 cents) and recording total sales of $13.51 billion, significantly surpassing anticipated figures. This notable success was driven by robust sales in data centers, which outperformed expert estimates by almost 30%, alongside elevated sales in the Gaming and ProViz sectors.

Their forthcoming quarter forecasts appear promising, with anticipated sales reflecting a 27% increase, augmented profitability per sale, and prudent operational spending. Market analysts responded favorably to these outcomes, revising their forward expectations for Nvidia upwards. Acknowledging Nvidia’s adept performance in data centers and enhancing the gaming domain, they highlighted the company’s strategic efforts to meet escalating demand by diversifying its product portfolio. However, a degree of caution was expressed due to potential challenges related to chip sales in China and subdued performance in the automotive sector.

Broadcom Inc. (AVGO) – 5.07% Weight | 1.72% Contribution to return

In Q2, Broadcom exceeded expectations with revenue up 3.5% and earnings per share (EPS) beating forecasts by 2.0% or $0.30. Analysts were upbeat about strong Networking growth driven by AI demand, boosting the Semi business before the iPhone refresh. Positive factors include an Apple deal, projected AI revenue increase, and optimism about deal closures. This led to raised estimates and a higher average price target of $847.31.

Top Two Detractors for SMH in Q2

QUALCOMM Inc. (QCOM) – 4.41% Weight | -0.58% Contribution to return

Following Qualcomm’s Q3 report, shares fell broadly. The company’s revenue of $8.44 billion was 0.8% below expectations, while EPS of $1.87 exceeded predictions by $0.06. Across its segments, QCT’s (technology business) revenue was below target but EBT (earnings before taxes) was in line, while QTL (licensing business) missed on both revenue and EBT. The management’s Q4 guidance indicates that the midpoint of their revenue and EPS goals is below the previous consensus. Analysts have generally labeled the Q3 results and outlook as disappointing, citing challenges from China, Huawei, and inventory adjustments that had a greater impact than anticipated. Despite this, some analysts find the valuation favorable and remain optimistic about the company’s longer-term prospects.

STMicroelectronics (STM) – 2.03% Weight | -0.33 Contribution to return

STMicroelectronics reported strong earnings and guidance, the company anticipates gross margin pressures in the second half of 2023, with a full-year gross margin guidance of 47-48%. During their quarterly earnings call, management highlighted three key factors contributing to this pressure: increased manufacturing input costs, less optimized production levels in consumer and personal electronics, which is expected to be a $0.5 billion headwind in the second half, and the impact from the ramp-up of 300-millimeter graph as it enters the cost of goods sold. However, the company expects a positive contribution to the gross margin in 2024. Additionally, by the end of 2023, the company anticipates its number of days of inventory to be between 105-110 days, which is slightly higher than the year-end 2022 figures.

Standardized Performance

Quarter End Returns as of 6/30/2023
1 Yr 5 Yr 10 Yr Since Inception Inception Date Expense Ratio
VanEck Semiconductor ETF SMH NAV 51.36 25.77 24.83 23.87 12/20/2011 Gross 0.35%
Mkt Price 51.23 25.72 24.81 23.87 Net 0.35%
MVSMHTR Index 50.43 25.83 24.84 23.86

The performance data quoted represents past performance. Past performance is not a guarantee of future results. Investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Performance may be lower or higher than performance data quoted. Please call 800.826.2333 or visit for performance current to the most recent month ended. 

The “Net Asset Value” (NAV) of a Fund is determined at the close of each business day, and represents the dollar value of one share of the fund; it is calculated by taking the total assets of the fund, subtracting total liabilities, and dividing by the total number of shares outstanding. The NAV is not necessarily the same as the ETF’s intraday trading value. Investors should not expect to buy or sell shares at NAV.

For more information on the VanEck Semiconductor ETF (SMH) please read the Fund FAQ.

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