Global Chip Stocks Plunge: Micron, SK hynix, SanDisk Tumble

According to market data, global semiconductor stocks suffered a sharp sell-off on Tuesday (July 28) as investors reassessed the long-term profitability and financing pressure behind massive artificial intelligence (AI) infrastructure investments. Growing concerns over rising capital spending by technology giants, combined with the rapid expansion of China’s semiconductor industry, intensified worries about future market competition.

U.S. chip stocks extended losses from the previous trading session, with memory and storage companies facing the strongest selling pressure. Micron Technology, SK hynix ADRs, and Seagate Technology all dropped more than 8%. Western Digital fell nearly 7%, while SanDisk plunged more than 14%.

Other major semiconductor companies also faced significant declines. Intel shares fell nearly 6%, while AMD dropped about 8%. AI chip leader NVIDIA initially declined at market open before recovering, ending the session largely unchanged.

The broad-based sell-off dragged the PHLX Semiconductor Sector Index down nearly 5% to its lowest level in more than two months, indicating that investors are adjusting positions that had previously benefited from strong AI-driven growth expectations.

The downturn followed heavy selling pressure across Asian semiconductor markets earlier in the day. In South Korea, the KOSPI index fell as much as 8% intraday, triggering its eighth market circuit breaker event of the year. After trading resumed, losses continued to widen, with the index closing down 10.8%.

South Korean semiconductor giants were among the biggest decliners. SK hynix shares plunged 14.65%, while Samsung Electronics dropped more than 13%. Other AI-related companies also suffered steep losses, including Samsung SDI, LG Innotek, Seoul Semiconductor, and LG Chem.

Japanese semiconductor stocks also declined sharply. Tokyo Electron dropped 10.96%, while Advantest fell more than 10%. SoftBank Group, which holds a stake in Arm Holdings and is viewed as an AI investment proxy, declined 4.43%. Japanese memory manufacturer Kioxia plunged more than 18%.

Taiwan’s semiconductor sector also weakened, with leading foundry TSMC falling nearly 3%. Meanwhile, China-focused technology indexes declined sharply, with the ChiNext Index falling 6.49% and the Hang Seng China Semiconductor Index dropping 7.02%.

The selling pressure later spread to European markets, with several major semiconductor companies continuing to experience declines. Semiconductor equipment companies were also affected, with ASM International and BE Semiconductor Industries falling between 5.31% and 3.56%.

The latest market correction highlights growing investor caution toward the semiconductor sector, as AI-driven demand remains strong but concerns increase over high investment costs, valuation levels, and intensifying global competition in advanced chips and memory technologies.