Nvidia (NVDA) led chip stocks lower on Thursday despite stellar earnings, as investors seemed to remain concerned about AI buildout plans.
The tech-focused Nasdaq Composite (COMP:IND) fell around 1.7%. At the same time, the benchmark S&P 500 (SP500) dipped about 1%. The blue-chip Dow (DJI) had declined by 0.4%.
AI chipmaker Nvidia’s (NVDA) stock slumped about 5%. On Wednesday, Nvidia (NVDA) not only topped fourth-quarter estimates by a wide margin, but its guidance surprised even the most bullish analysts.
However, investors seemed to be concerned about the massive AI buildout plans.
“Nvidia shares lost roughly 5% in Thursday morning’s trade, as investors remain worried over AI buildout plans. While Nvidia has best in class products and trades at a very reasonable valuation, the market doesn’t believe that the industry as a whole has the necessary capital required for such aggressive growth plans,” said Seeking Alpha analyst Bill Maurer.
Advanced Micro Devices (AMD) declined around 4%. Broadcom (AVGO) tumbled nearly 6%, while Qualcomm (QCOM) was also in the red on Thursday.
Meanwhile, other AI and networking-related stocks also declined on Thursday. Celestica (CLS) slumped about 6%, while Ciena (CIEN), Lumentum (LITE), and Coherent (COHR) each tumbled around 5%. Arista Networks (ANET) fell roughly 3%, while Cisco (CSCO) dipped about 2%.
Shares of GlobalFoundries (GFS) slumped around 6%, while Lattice Semiconductor (LSCC) fell nearly 5%. Marvell Technology (MRVL), Taiwan Semiconductor Manufacturing (TSM), Intel (INTC), Arm (ARM), and Micron Technology (MU) each declined around 4%. Analog Devices (ADI) fell about 3%, while Texas Instruments (TXN) dipped nearly 1%.
Chip equipment makers: Lam Research (LRCX) and Applied Materials (AMAT) each slumped around 6%, while ASML (ASML) declined about 5%. KLA (KLAC) fell about 3% on Thursday.