What Happened?
Shares of semiconductor designer Power Integrations (NASDAQ: POWI) jumped 20.2% in the afternoon session after 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.
After the initial pop the shares cooled down and closed the day at $43.18, up 24.7% from previous close.
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What Is The Market Telling Us
Power Integrations’s shares are very volatile and have had 20 moves greater than 5% over the last year. But moves this big are rare even for Power Integrations and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 3 days ago when the stock dropped 5.9% on the news that President Donald Trump threatened to impose 'massive' new tariffs on Chinese goods. President Donald Trump's threat of "massive" new tariffs on Chinese goods sent shockwaves through the market, directly impacting chipmakers like Nvidia and AMD. Trump noted China's tightening controls on rare earth metals, which are vital components in many technology products from electric vehicles to defense systems. Compounding the pressure, Beijing has reportedly initiated its own countermeasures. These include tightening export controls on crucial raw materials such as rare earths and launching an antimonopoly investigation into chip giant Qualcomm.
Furthermore, reports indicate that Chinese customs officials are now conducting stringent checks on semiconductor shipments arriving at ports, specifically targeting certain high-end chips. This escalating back-and-forth creates significant uncertainty for the semiconductor industry, which relies heavily on complex global supply chains and access to international markets, leading to a broad sell-off across the sector.
Power Integrations is down 25.9% since the beginning of the year, and at $45 per share, it is trading 33.9% below its 52-week high of $68.05 from November 2024. Investors who bought $1,000 worth of Power Integrations’s shares 5 years ago would now be looking at an investment worth $731.71.
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