- Semiconductor ETF fell 22.1% in July, while South Korea’s benchmark index surged nearly 18% in one session after historic losses
Global semiconductor and technology stocks recorded some of their sharpest price swings in years during July, with trillions of dollars in market value erased before chipmakers rebounded on strong cloud-computing earnings and continued artificial intelligence investment.
An index covering 80 of the world’s largest semiconductor companies lost more than $3 trillion in market value between the beginning of July and the lowest point of the selloff, according to Financial Times data.
The iShares Semiconductor ETF, which tracks major US-listed chip companies, fell 22.1% in July, its steepest monthly decline since December 2002.
Despite the monthly drop, the fund remained 67.7% higher since the beginning of the year.
The broader US technology-sector ETF declined 8%, while a software-focused fund gained 4.4%.
How large were the daily swings?
The Philadelphia Semiconductor Index rebounded about 10% over July 30-31, marking its strongest two-day increase since June 12.
However, the index was still approximately 22% below its June 22 closing peak.
Micron Technology rose 18.4% on July 30 before falling 5.9% the following session. The US memory-chip producer ended July down 28.7%, illustrating the scale of the daily reversals within the sector.
The swings were even larger in South Korea. The Kospi index dropped 10.8% on July 28 as Samsung Electronics lost 13.4% and SK Hynix fell 14.7%. Three days later, the Korean benchmark surged nearly 18% as investors moved back into semiconductor shares.
On Monday, the Kospi fell over 5.1%, SK Hynix lost 3.5%, and Samsung decreased more than 8.7%.
The Nasdaq 100 also fell more than 10% from its early-June peak during the selloff, entering correction territory as declines spread from chipmakers to other AI-linked technology companies.
What do chipmakers’ earnings show?
Nvidia reported revenue of $81.6 billion for its fiscal first quarter, an increase of 85% from a year earlier. Data-center revenue rose 92% to $75.2 billion and accounted for more than 92% of the company’s total sales.
Micron’s fiscal third-quarter revenue reached $41.46 billion, compared with $9.30 billion in the same quarter a year earlier, representing an increase of 346%. DRAM revenue rose 343% to $31.33 billion, while NAND revenue increased 361% to $9.94 billion.
Samsung Electronics posted record second-quarter revenue of 171.5 trillion won, or approximately $124 billion, up 28% from the previous quarter.
Samsung’s Device Solutions division, which includes its semiconductor operations, generated $89.3 billion in revenue and $62.5 billion in operating profit. The company said its memory business recorded its highest-ever quarterly revenue and profit, supported by server products, HBM4 shipments and higher memory prices.
SK Hynix reported second-quarter revenue of $55.5 billion, up 257% year over year, while operating profit increased 557% to $42.4 billion. Its operating margin reached 76%, compared with 41% a year earlier.
The company began mass shipments of HBM4 during the quarter and said it had completed long-term supply agreements with around 10 customers.
Taiwan Semiconductor Manufacturing Co.’s revenue increased 67.9% year over year in June to $13.6 billion. Revenue for the first six months of 2026 rose 35.6% to $73.9 billion.
How much are technology companies spending on AI?
Microsoft reported quarterly revenue of $90 billion, up 18% year over year. Azure and other cloud-services revenue increased 43%, while total Microsoft Cloud revenue rose 27% to $59.3 billion.
Azure’s annual revenue surpassed $100 billion for the first time, and Microsoft’s commercial remaining performance obligations, a measure of contracted future revenue, increased 84% to $678 billion.
Amazon’s AWS cloud unit generated $42.2 billion in second-quarter sales, up 37%, its fastest growth in 18 quarters. AWS operating profit increased 64% to $16.6 billion.
Amazon said its trailing 12-month purchases of property and equipment increased by $66.1 billion, mainly because of AI investment. The increase pushed trailing free cash flow from an inflow of $18.2 billion a year earlier to an outflow of $7.6 billion.
Alphabet spent $44.9 billion on capital expenditures during the second quarter, with most of the money directed toward servers, data centers and networking equipment.
Google Cloud revenue rose 82% to $24.8 billion, while cloud operating profit more than tripled to $8.8 billion. Alphabet’s cloud backlog reached $514 billion, increasing by more than $50 billion from the previous quarter.
Meta’s second-quarter capital expenditures reached $31.08 billion, compared with $17.01 billion a year earlier. The company raised the lower end of its 2026 capital-spending forecast and now expects expenditures of $130 billion to $145 billion.
Meta’s revenue increased 28% to $60.8 billion, but operating income declined 8% and free cash flow fell to $784 million as spending increased.
What are memory prices showing?
Conventional Dynamic Random-Access Memory (DRAM) contract prices increased an estimated 58% to 63% quarter on quarter in the second quarter, while NAND flash prices rose 70% to 75%, according to TrendForce.
For the third quarter, conventional DRAM prices are forecast to rise a further 13% to 18%, while NAND prices are expected to increase by 10% to 15%.
TrendForce said price growth was beginning to moderate because higher memory costs were reaching affordability limits for PC and smartphone manufacturers, even as demand from AI servers remained strong.
Semiconductor manufacturers are also continuing to expand production capacity. Global chipmaking-equipment sales are forecast to increase 23.2% this year to a record $165.9 billion, according to industry association SEMI.
Wafer-fabrication equipment sales are projected to rise 23.1% to $143.9 billion, while spending on DRAM equipment is expected to increase 39% to $38.8 billion. NAND equipment sales are forecast to grow 30.7% to $13.9 billion.
