What Happened?

A number of stocks jumped in the afternoon session after the Trump administration announced a plan to create a voluntary investment consortium targeting $4 trillion in funding for semiconductor supply chains, energy projects, and critical minerals. 

The initiative, an expansion of the 'Pax Silica' program launched in December 2025, aims to secure access to AI and chipmaking for the U.S. and its allies. According to reports, the U.S. government will contribute an initial $250 million toward the ambitious goal. This move signals strong government support for the domestic and allied chip industry, boosting investor confidence. The prospect of significant capital infusion into the sector could lead to the development of new manufacturing facilities, research advancements, and a more resilient global supply chain, benefiting chipmakers and related technology companies.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Analog Semiconductors company onsemi (NASDAQ: ON) jumped 3.8%. Is now the time to buy onsemi? Access our full analysis report here, it’s free.
• Analog Semiconductors company Sensata Technologies (NYSE: ST) jumped 4.9%. Is now the time to buy Sensata Technologies? Access our full analysis report here, it’s free.
• Analog Semiconductors company Vishay Intertechnology (NYSE: VSH) jumped 4.6%. Is now the time to buy Vishay Intertechnology? Access our full analysis report here, it’s free.
• Processors and Graphics Chips company Allegro MicroSystems (NASDAQ: ALGM) jumped 2.3%. Is now the time to buy Allegro MicroSystems? Access our full analysis report here, it’s free.
• Analog Semiconductors company Power Integrations (NASDAQ: POWI) jumped 5.1%. Is now the time to buy Power Integrations? Access our full analysis report here, it’s free.

Zooming In On Power Integrations (POWI)

Power Integrations’s shares are very volatile and have had 24 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was 5 months ago when the stock gained 20.2% on the news that the company detailed its collaboration with NVIDIA to advance its PowiGaN gallium-nitride technology for next-generation AI data centers. 

The partnership aimed to accelerate the transition to more powerful 800 VDC systems designed for megawatt-scale computer racks that power artificial intelligence. Power Integrations published a white paper at the 2025 OCP Global Summit explaining the benefits of its technology. According to the company, its new chips delivered greater power density and efficiency compared to competing devices. The announcement was significant as the demand for power in AI data centers has been rising rapidly, and this technology helped address that need by simplifying rack design and making more efficient use of space.

Power Integrations is up 34.1% since the beginning of the year, but at $50.04 per share, it is still trading 16% below its 52-week high of $59.54 from July 2025. Despite the year-to-date gain, investors who bought $1,000 worth of Power Integrations’s shares 5 years ago would now be looking at only $634.56.

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