---
title: "AI boom is cracking: why investors are mass-dumping chipmaker stocks"
description: "The semiconductor market is experiencing a serious correction: the chipmaker index fell by 10% in a week. Investors are taking profits amid doubts about the ROI of AI investments and news of Google's delays. 📉🤖"
date: 2026-07-18T13:35:32.000Z
lang: en
url: https://xab.info/en/posts/ai-boom-cracking-investors-dumping-chipmaker-stocks
tags: [google, nvidia, semiconductors, artificial-intelligence]
publisher: "XAB.info"
---

# AI boom is cracking: why investors are mass-dumping chipmaker stocks

![3D Google logo over microchips, symbolizing the link between AI tech and chipmakers amid stock decline](https://xab.info/media/2026/07/18/korektsiya-rynka-poluprovodnikov-i-ii-investitsii/korektsiya-rynka-poluprovodnikov-i-ii-investitsii-1.webp)

The past week has been a true test for semiconductor manufacturers. The market, which has been living in an euphoria over the artificial intelligence boom for the last few months, has begun to cool down sharply. Investors around the world, from Europe to Asia, are asking an uncomfortable question: have we gone too far, and will companies be able to justify record investments in AI infrastructure?

### Panic on the stock exchanges

The statistics are relentless. The Philadelphia Semiconductor Index, which serves as a barometer for the industry, lost about 10% in just one week. Looking at the historical high reached at the end of June, the decline amounts to almost 20%. Even against the backdrop of such a correction, the index is still showing growth of more than 60% year-to-date, although market sentiment has changed radically.

The correction has not spared other key markets either. The South Korean KOSPI index, which grew by 62% over the year, has officially entered a "bear" market phase. The Japanese Nikkei has also entered a correction zone, while the European technology sector, which showed its best result since 2001 in the second quarter, turned out to be among the main laggards of the week.

### Reasons for capital outflow

Analysts agree: investors are taking profits and reviewing their portfolio structures. Chip manufacturers are a traditionally cyclical sector, whose stocks always react sharply to the slightest changes in sentiment. This time, the trigger was two factors.

The first was the announcement by Chinese startup Moonshot, which presented an open-weight model with 2.8 trillion parameters. This made investors doubt the necessity of the multi-billion dollar spending by American giants on developing their own AI models.

The second blow was a Bloomberg report stating that Google is lagging behind the schedule for releasing its flagship model, Gemini 3.5 Pro, by several months. Doubts about the pace of technological development have undermined confidence in the quick return on investment.

### Who lost the most

The S&P 500 Momentum Index, which combines stocks with the strongest momentum, fell by 11% in July, while the broad index lost less than 1%. The Direxion Daily Semiconductor Bull 3X ETF, focused on chip manufacturers, fell by more than half relative to the June peak.

On Friday, the exchange recorded a drop in the stocks of key players:

- Nvidia dropped by 2.2%;

- Intel lost 2%;

- Applied Materials fell by 5.6%;

- SanDisk — by 4%.

Separately, it is worth noting SpaceX shares, which lost 5.4% after the cancellation of the 13th Starship test flight. Micron shares fell slightly — by 0.5%, while SK hynix American depositary receipts, although they dipped below the IPO price, ultimately ended the day with a slight increase.

### Expectations and prospects

Despite the sell-off, market participants are not in a rush to leave the technology sector completely. Traders are using the current correction to buy, and "bull" options are supporting interest in SK hynix, Micron, and SanDisk stocks. Experts suggest that the market may reach a short-term oversold minimum.

The decisive word in the coming days will be the quarterly reports. Next week, investors will wait with bated breath for reports from Alphabet, Tesla, and Intel. It is these documents that will show how justified the current market concerns are and whether the industry is ready to meet inflated expectations.