Global Chip Stocks Lose Over $1.5 Trillion in Market Cap This Week, Nvidia Leads Decline with Nearly $250
Global chip stocks lost over $1.5 trillion in market capitalization this week, led by Nvidia which saw nearly $250 billion wiped from its value since last Friday. Other major decliners include SK Hynix and Samsung Electronics, which lost $176 billion and $173 billion respectively. The sell-off extended across Asian markets, with South Korea's Samsung Electronics falling over 5% and Japan's Kioxia plunging 13.85%. The Philadelphia Semiconductor Index has dropped nearly 20% in the past month after a 92% gain over the previous 12 months. Investor concerns focus on whether massive AI spending by tech giants will yield returns.
Global chip stocks saw a total market capitalization loss of over $1.5 trillion this week. On Wednesday, Asian tech stocks continued their sell-off, with the semiconductor sector leading the decline. Samsung Electronics fell over 5%, LG dropped 10.89%, and Seoul Semiconductor declined 8.89%. In Japan, the chip sector broadly declined, with memory maker Kioxia plunging 13.85%, Tokyo Electron falling 10.59%, and SoftBank dropping 6.95%. In Taiwan, TSMC closed down 3.51%.
The sell-off was led by Nvidia: since last Friday's close, Nvidia's market cap has shrunk by nearly $250 billion. SK Hynix and Samsung Electronics saw market cap losses of $176 billion and $173 billion, respectively. Micron Technology and AMD lost about $130 billion combined, while TSMC's market cap fell by $119 billion. Based on FactSet data, the total market cap loss for the world's top 20 chip companies since last Friday's close exceeds $1.5 trillion.
Over the past two years, the AI industry boom has made the chip sector one of the biggest beneficiaries, with funds pouring into related stocks. The Philadelphia Semiconductor Index (SOX), which covers 30 top U. S. chip companies, had gained 92% over the past 12 months but has retreated nearly 20% in the past month.
About one-third of S&P 500 components are reporting earnings this week, making it the busiest week of the second-quarter earnings season. According to LSEG IBES data, as of Wednesday, over 80 S&P 500 companies had reported, with net profit up 26.5% year-on-year. However, investors' core concern is brewing: whether the massive AI spending by major tech companies will ultimately pay off. Alphabet's earnings have already highlighted this contradiction.