Chip stocks sell off as high expectations overshadow Samsung results
Investors dumped semiconductor stocks following results released Tuesday. Samsung Electronics Wall Street’s high demand for AI failed to meet its expectations.
Shares fell 8% even after the South Korean electronics company’s quarterly profit surpassed both Nvidia And Appleand the company said it expects operating profit to increase 1,800%.
The results are the latest sign on Wall Street that sometimes better results aren’t enough to satisfy investors in the AI revolution. Previously, this market phenomenon contributed to post-earnings declines for Nvidia and major cybersecurity stocks like CrowdStrike and Palo Alto Networks.
South Korea’s shares listed in Korea kospi Sympathy for Samsung fell by about 5%. SK Hynix, Shares scheduled to list on Nasdaq this Friday fell nearly 7%. The company plans to generate $28 billion in revenue from the next largest sale SpaceX.
Tuesday’s sell-off could also be due to a recalibration of expectations following memory’s historic rally or as investors prepare for the listing of SK Hynix this week.
US memory makers sandisk And Micron Technology While there was a decrease in sympathy by 8% and 5% respectively, iShares Semiconductor ETF fell by approximately 5%. Intel And Applied Materials While each fell by about 8%, Lam Research It fell 7%. Advanced Micro Devices fell about 5%.
Memory chip stocks have surged this year as supply shortages fueled by incessant artificial demand have allowed businesses to set pricing. This has boosted shares of Micron and Sandisk by more than 220% and 570%, respectively, this year.
But investors are increasingly concerned that AI spending won’t be able to keep up with rapidly rising memory prices.
Rising memory costs have already strained companies including Apple. Microsoftwith raise prices and offset the high fees associated with creating everyday consumer products.
Didn’t help Tuesday’s sales report Chinese artificial intelligence startup Deepseek is working on its own chip to bypass US export bans and dependence on Nvidia.
