AMD tops Nvidia in $45 billion SOXX ETF as Micron surges 600%

AMD became the largest holding in the $45 billion iShares Semiconductor ETF on July 15, edging out Nvidia by 0.16 percentage points as Micron's 600% rally reshuffled the fund's top ranks.

The shift reflects the fund's 8% cap on its five largest holdings — a mechanism that prevents Nvidia's $5.1 trillion market capitalization from dominating the index. Between quarterly rebalances, weights drift with share-price momentum, and AMD's 200% gain over the past year has outpaced Nvidia's roughly 22% rise.

"Once they stop increasing their capex, it will definitely be a relief for hyperscalers and a negative signal for the semi industry," Alexis Bossard, global equity portfolio manager at Edmond de Rothschild Asset Management, said, describing why some fund managers are reducing semiconductor exposure.

As of July 15, AMD held 8.51% of SOXX assets, followed by Nvidia at 8.35%, Micron Technology at 7.73% and Broadcom at 7.32% — a spread of just over one percentage point across the top four. The gaps are thin enough that a single trading day could reorder them. The index rebalances quarterly, most recently after the third Friday of June, meaning the current ordering reflects share-price movement since that reset.

The reshuffle signals a broadening of the AI trade beyond Nvidia alone. Micron reported record fiscal third-quarter revenue of $41.5 billion for the period ended May 28, up from $23.9 billion the prior quarter and $9.3 billion a year earlier. Net income reached $28.2 billion, driven by high-bandwidth memory (the stacked chips that feed AI accelerators) shipping in high volume. AMD's data center revenue rose 57% to $5.8 billion in the first quarter as its Instinct graphics processing units ramped.

Nvidia's business has not slowed — revenue for its fiscal first quarter of 2027 rose 85% to a record $81.6 billion, with data center revenue up 92% to $75.2 billion. The slip in the fund is not a slip in the business. It is a sign that the AI buildout now has more than one way to win.

The Cap That Levels the Giants

The SOXX ETF tracks the NYSE Semiconductor Index, which holds the 30 largest U.S.-listed semiconductor companies and weights them by float-adjusted market capitalization — with a catch. The five largest stocks are capped at 8% of the index when weights are reset, and every other holding at 4%. Left to pure market-cap math, Nvidia's valuation would run several times the 8% limit and dominate the entire fund. Instead, Nvidia gets pinned at the ceiling alongside anything else that outgrows it.

Come the index's September reconstitution, anything riding above the cap gets pinned back at 8%, and the drift starts over. For Nvidia shareholders, the demotion is not a sell signal — the company just posted 85% growth on record revenue. But the leaderboard is a useful reminder that the AI infrastructure buildout is widening.

Investor Rotation and the Capex Question

Hyperscaler capital expenditure is expected to rise 76% this year to approximately $673 billion, according to UBS. But spending growth is forecast to slow to 25% in 2027 and just 6% in 2028, raising questions about whether the semiconductor rally can sustain its pace.

Bank of America's July survey of global fund managers found that 82% identified semiconductors as the market's most crowded trade, while none reported holding short positions in the sector. Some active managers have begun reducing semiconductor exposure in favor of hyperscalers and software companies.

Nvidia shares trade at roughly 35 times forward earnings. AMD trades at a higher multiple, reflecting the market's expectation that its Instinct GPU lineup will capture a larger share of the AI accelerator market. Micron, now up more than 600% over the past year, trades at a discount to both on a forward earnings basis, though its memory business is more cyclical.

The September rebalance will reset the cap again. Until then, the drift continues — and the race at the top of SOXX remains the tightest it has been in years.

This article is for informational purposes only and does not constitute investment advice.