Sefa Ozel
Intel (NASDAQ:INTC) led a decline in chip stocks on Friday after the company's second-quarter results and guidance worried investors and analysts alike.
Arm (ARM) -8%Micron technology (MU) -7%ON Semiconductor (EN) -5%Taiwan semiconductor manufacturing (TSM) -5%Analog devices (GOING) -4%NXP Semiconductors (NXPI) -4%Broadcom (AVGO) -3%Texas Instruments (TXN) -3%Nvidia (NVDA) -1%and Qualcomm (QCOM) -1%.
Advanced Micro Devices (AMD) +2%, an Intel competitor, was among the few in the green on Friday.
Intel lost about 25% of its market capitalization on Friday after the publication of its results and forecasts, disappointing investors. The chipmaker also announced that it would lay off about 15% of its employees and suspend dividend payments.
Analysts at Raymond James had expected the third-quarter outlook to be weak but were surprised by the magnitude, especially at margins.
Arm (ARM) continued Thursday’s sell-off into Friday following its quarterly results and guidance two days ago.
Meanwhile, Nvidia shares took a hit following reports that the US Justice Department has launched an investigation into the company following complaints from rivals that the chipmaker allegedly abused its market dominance by selling chips that power artificial intelligence products. Nvidia is also facing scrutiny from the Justice Department over potential antitrust issues related to its planned acquisition of Israeli startup Run:ai.
Separately, hedge fund Elliott Management said Nvidia is in a bubble because the artificial intelligence theme that drives its stock price is overhyped.
