Semiconductor

AAA

DEFINITION of 'Semiconductor'

A materials product - usually comprised of silicon - which conducts electricity more than an insulator but less than a pure conductor, such as copper and aluminum. Semiconductors are usually very small and complex devices, and can be found in thousands of products such as computers, cell phones, appliances, and medical equipment.

Also known as "chips" or "semis".

INVESTOPEDIA EXPLAINS 'Semiconductor'

As semiconductors have evolved and become more powerful, they have propelled many industries forward into a technological age. They are still an expensive component in many devices, so their pricing and demand trends go a long way in determining the profit potential of companies that sell devices with semiconductors in them. Chips are made by the billions each year, and their sales & pricing trends are widely followed by analysts as a harbinger of technology-related profits.

Semiconductor makers often see "boom and bust" cycles based on the underlying demand for chip-based products. When times are good profit margins can run very high for chipmakers; when demand falls through however, chip prices can fall dramatically and have a major affect on many industries' supply chains.

RELATED TERMS
  1. Operating Leverage

    A measurement of the degree to which a firm or project incurs ...
  2. Philadelphia Semiconductor Index ...

    A price-weighted index composed of 18 U.S. semiconductor companies ...
  3. New Economy

    A buzzword describing new, high-growth industries that are on ...
  4. Gross Margin

    A company's total sales revenue minus its cost of goods sold, ...
  5. Book-To-Bill Ratio

    The ratio of orders received to units shipped and billed for ...
  6. Silicon Valley

    A part of the San Francisco Bay Area that is known for the many ...
Related Articles
  1. Investing Basics

    Industry Handbook

    In this feature, we take an in-depth look at the various techniques that determine the value and investment quality of companies from an industry perspective.
  2. Investing

    Venturing Into Early-Stage Growth Stocks

    Picking these potential winners is all about sizing up risk. We show you how.
  3. Investing Basics

    A Primer On Investing In The Tech Industry

    The tech sector can provide fantastic returns for investors with a little know-how in the field.
  4. Mutual Funds & ETFs

    Should You Buy Stock Or An ETF?

    Not all investors are the same. By the same token, not all investment types are suited for each individual investor.
  5. Investing

    Clean Or Green Technology Investing

    Innovations in energy and consumption grow as companies adopt them to reduce costs.
  6. Active Trading

    The Advantage Of Intermarket Analysis

    Analyzing a variety of markets around the world can provide powerful insight into trading opportunities.
  7. Entrepreneurship

    How Steve Jobs Changed The World

    As an innovator and visionary, Steve Jobs’s accomplishments can be held on a pedestal with the likes of Microsoft’s Bill Gates, Google’s Larry Page and Sergey Brin and Facebook’s Mark Zuckerberg.
  8. Economics

    EU Probes Tax Laws To Catch Corporate Cheaters

    Recently, the EU has launched an investigation into tax deals between Amazon and the country of Luxembourg.
  9. Investing Basics

    The Strange New World Of The Bitcoin Exchange Futures Market

    We explain the basics of the Bitcoin exchange and futures market.
  10. Entrepreneurship

    How do people make money on the videos they upload to YouTube?

    Learn about the primary ways that people can generate income based on the videos they upload to YouTube, including advertising and product placement.

You May Also Like

Hot Definitions
  1. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  2. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  3. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  4. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  5. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
  6. Fixed Asset

    A long-term tangible piece of property that a firm owns and uses in the production of its income and is not expected to be ...
Trading Center