Nvidia, AMD and Micron Fall as AI Spending Concerns Hit Chip Stocks
Nvidia, AMD and Micron shares fell sharply Monday as investors questioned the pace of AI development. Nvidia dropped about 3%, AMD 4.5% and Micron 5.4%. The Philadelphia semiconductor index fell more than 5%, while the broader S&P 500 and Nasdaq also declined.
The selloff followed calls from major AI leaders to slow frontier AI development because of safety and economic risks. Investors are now weighing whether slower model development could reduce demand for data centers, GPUs and high-bandwidth memory. However, there is no confirmed evidence of broad AI infrastructure spending cuts. Analysts continue to expect substantial investment, with global AI-related capital spending projected near $800 billion in 2026.
The market is also facing pressure from rising oil prices and Treasury yields. The 10-year U.S. yield briefly exceeded 5%, increasing concerns about higher financing costs and equity valuations. Investors will watch upcoming company guidance and AI infrastructure orders for clearer evidence of whether the slowdown fears reflect sentiment or a fundamental demand shift.
Why it matters
AI hardware valuations depend heavily on sustained data-center spending. Any evidence of weaker orders could increase volatility across semiconductor stocks and the broader technology market.
