Asian Chip Stocks Tumble After Western Digital and Sandisk Forecasts Disappoint
Asian memory chip equities fell sharply on Thursday, led by drops in SK Hynix and Samsung Electronics. The selloff followed underwhelming earnings guidance from U.S. firms Western Digital and Sandisk, reigniting investor concerns that AI-driven semiconductor valuations had climbed too high and that sector momentum might be fading after a strong rally.
Key points
- SK Hynix dropped nearly 9% and Samsung Electronics fell around 6% during Thursday's trading session.
- South Korea's KOSPI index slipped about 4% as the broader regional semiconductor market suffered losses.
- Western Digital plunged over 9% in after-hours trading after issuing a revenue forecast that only slightly exceeded Wall Street expectations.
- Sandisk fell roughly 8% because its quarterly profit outlook failed to meet elevated market expectations.
- Analysts note the weak forecasts renewed worries about stretched valuations across the AI-linked memory chip sector.
Asian memory chip equities experienced a broad selloff on Thursday, triggered by cautious earnings guidance from U.S. technology firms Western Digital and Sandisk. SK Hynix led the regional losses with a drop of nearly 9%, while Samsung Electronics declined by approximately 6%. The sharp downturn significantly impacted South Korea's KOSPI index, which slipped about 4% during the session.
The negative momentum originated from the United States, where Western Digital plunged more than 9% in after-hours trading. Although the company's revenue forecast edged past Wall Street estimates, investors expressed disappointment given that the stock has nearly tripled this year amid robust artificial intelligence demand. Simultaneously, Sandisk shares fell roughly 8% after its quarterly profit outlook missed elevated market expectations.
These updates revived investor anxiety regarding stretched valuations within the semiconductor industry. Market observers pointed out that the sector had already experienced a sharp correction in July due to valuation concerns before staging a modest recovery in early August. The latest guidance suggests that the rapid momentum fueled by the AI investment boom may be cooling, resulting in renewed selling pressure across global markets.
Sources
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