Shares of AMS, which provides 3D sensors for Apple's FaceID technology as well as for Android devices, surged as much as 9% after the company said it expects revenue to reach $600-$640 million in the third quarter from its second quarter current revenue of $415 million. The Austrian chipmaker said it expects growth will be driven by "high volume ramps for smartphone sensing solutions."
"The results reflect the strength of AMS' portfolio and more supportive demand trends in the consumer market," the company said in its earning release.
The PHLX Semiconductor Index ETF gained 2% on Monday after Goldman Sachs analysts upgraded three memory chip companies citing signs that demand will pick up. Chip stocks have been volatile in recent months amid ongoing trade tensions between the U.S. and China.
On Tuesday, the Wall Street Journal reported Apple is in advanced talks to buy assets from Intel's modem chip business, which is valued at $1 billion or more. The deal would mark a big step for Apple toward developing its own 5G devices.
– Reuters contributed to this report