{"id":645007,"date":"2026-10-13T10:06:12","date_gmt":"2026-10-13T10:06:12","guid":{"rendered":"https:\/\/www.newsbeep.com\/il\/645007\/"},"modified":"2026-10-13T10:06:12","modified_gmt":"2026-10-13T10:06:12","slug":"chip-stocks-slide-after-broadcom-boss-likens-ai-investing-to-casino-stock-markets","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/il\/645007\/","title":{"rendered":"Chip stocks slide after Broadcom boss likens AI investing to \u2018casino\u2019 | Stock markets"},"content":{"rendered":"

Shares in semiconductor companies fell on Tuesday after the boss of Broadcom compared many AI investors to \u201ccasino\u201d gamblers, and the Chinese memory chip maker CXMT said it had made good progress on a new chip architecture.<\/p>\n

South Korea\u2019s benchmark Kospi index tumbled 6.25% as investors dumped chip stocks, while other Asian markets were also lower. Japan\u2019s Nikkei fell 1.8% and the Taiwan exchange lost almost 2%, with the country\u2019s chip maker TSMC down by a similar amount.<\/p>\n

Samsung Electronics shares dropped 7.4% on the South Korean exchange, while the memory chip maker SK Hynix was down 10%.<\/p>\n

In Japan, the chip equipment maker Tokyo Electron fell 7.15% while SoftBank Group, an OpenAI investor, lost 8.5%.<\/p>\n

US stock futures point to a mixed open on Wall Street after the technology-heavy Nasdaq composite slipped 0.4% on Monday. The US chipmaker Micron Technology slid 3.9% while Nvidia, Advanced Micro Devices and Broadcom also fell. Crude oil prices dropped amid escalating tensions in the Middle East.<\/p>\n

AI shares have been on a rollercoaster in recent months amid concerns that companies are spending eye-watering amounts on AI infrastructure, funded by debt.<\/p>\n

The latest sell-off came after the South China Morning Post reported on Monday that CXMT had made good progress on new Dram architecture that would boost memory density. Investors are worried that it could challenge Samsung, SK Hynix and Micron, the world\u2019s biggest memory chip makers.<\/p>\n

CXMT, which had an impressive debut on the Shanghai stock market in late July, makes Dram chips<\/a>, which store the data that other AI chips draw on for their calculations.<\/p>\n

\u201cThe rout in chip stocks seems set to continue thanks once again to news from China,\u201d said Chris Beauchamp, the chief market analyst at the investing and trading platform IG.<\/p>\n

\u201cCXMT\u2019s new developments remind investors of the huge competition in the sector. While great for customers who can enjoy the white heat of technological improvement and get falling margins into the bargain, it is dangerous for high-flying tech stocks who have promised so much, and on whom the entire stock market rally seems to rest.\u201d<\/p>\n

Hock Tan, the chief executive of the US chipmaker Broadcom, said the AI boom had attracted investors who did not really understand what they were betting on.<\/p>\n

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\u201cA lot of investors have no clue what they are investing in,\u201d he said at a conference in Singapore, in comments reported by Bloomberg<\/a>. They \u201cset very extreme expectations only to find out that it\u2019s almost like they are in a casino\u201d.<\/p>\n

AI companies such as the ChatGPT maker OpenAI are still loss-making. Tan said OpenAI\u2019s annualised revenues of $50bn (\u00a338bn) at the end of September suggested a viable business model but offered little guarantee on long-term profitability.<\/p>\n

\u201cFor now it\u2019s still losing money because they\u2019re spending a lot on training,\u201d Tan said. \u201cSo frankly, it doesn\u2019t tell anything at this point except that there is a lot of potential revenue growth out of providing frontier generative AI models.\u201d<\/p>\n

He noted that a sizeable portion of AI labs\u2019 enterprise revenue came from pilot projects. \u201cWhen you are a kid you go to a video arcade, you play,\u201d he said. \u201cYour parents give you $10 of tokens, you finish it in 10 minutes and you haven\u2019t learned anything.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Shares in semiconductor companies fell on Tuesday after the boss of Broadcom compared many AI investors to \u201ccasino\u201d…\n","protected":false},"author":2,"featured_media":645008,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[114,85,46],"class_list":["post-645007","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business","tag-il","tag-israel"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/645007","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=645007"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/645007\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/645008"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=645007"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=645007"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=645007"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}