Chip Stocks Lose Over $1 Trillion in Market Value in One Day

U.S.-traded chipmakers experienced a dramatic selloff on Friday, wiping out more than $1 trillion in market capitalization. The losses were concentrated among AI heavyweights such as Nvidia (NVDA), Micron Technology (MU), and Advanced Micro Devices, following a disappointing quarterly report from Broadcom (AVGO) that triggered a wave of selling on Wall Street.

Details of the Move

The PHLX Semiconductor Index slumped approximately 8.5% in afternoon trading, putting it on track for its steepest one-day decline since the "Liberation Day" tariff-driven selloff in April 2025.

Potential Causes

The selloff intensified after Broadcom released a quarterly report showing demand for its custom AI chip business fell short of lofty expectations. Friday's decline added to losses from Thursday, when the report was initially released.

Context

This downturn comes at a sensitive time for the semiconductor sector, which has been a key driver of market gains due to surging demand for AI technologies. However, any sign of slowing demand—even from a company as large as Broadcom—can trigger broad-based selling.

Similar Moves in the Sector

The losses were not limited to the mentioned stocks but spread across most chip companies, reflecting widespread concern about high valuations and the potential for a slowdown in AI spending.