Chip stocks fall as Nvidia supplier highlights market uncertainty
Published On Jan 23, 2025, 10:09 AM
Chip stocks have fallen following comments made by SK Hynix, a major supplier of Nvidia, during their earnings call. SK Hynix indicated uncertainty in the semiconductor market for 2025, citing issues such as inventory adjustments by OEMs and geopolitical risks. This sentiment led to declines in several chip stocks, including Nvidia and Micron, as analysts warned of a potential slowdown in AI chip revenue. However, there remains optimism for memory chips used in AI data centers, driven by ongoing investments from big tech companies.
Stock Forecasts
NVDA
Negative
Given the prevailing uncertainty in the semiconductor market and the specific warnings about revenue growth deterioration for non-AI related chips, the overall outlook for the semiconductor sector appears negative. Companies like Nvidia and Micron may face price pressures as demand fluctuates, and the narrative suggests caution over the next few quarters.
MU
Negative
Despite the immediate negativity impacting shares, the long-term demand for AI memory products remains robust, supported by Big Tech investments. Stocks related to AI infrastructure could see strong rebounds, but in the near term, caution is advised based on current demand outlooks.
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