As Chip Stocks Slump an 8th Straight Day, AI Bubble Fears Grow

Semiconductor equities have now fallen in eight consecutive trading sessions, the longest losing streak in 16 years, according to Barchart data. The iShares Semiconductor ETF (SOXX) ended Thursday at $514.71, almost 14% below its October peak.

Thursday offered an early hint of buying support. After a brief dip beneath $496, the fund climbed back to close above its opening price on the strongest volume in months.

JUST IN 🚨: Semiconductor Stocks have now traded red for 8 straight days, their longest losing streak in 16 years 📉 📉

— Barchart (@Barchart) October 15, 2026

Which Holdings Are Investors Offloading?

SOXX is a BlackRock fund holding $44.7 billion that tracks the ICE Semiconductor Index, comprising around 30 US-listed chipmakers. The fund's 10 largest positions make up roughly 62% of its assets.

Advanced Micro Devices (AMD) 9.47%
Intel (INTC) 8.56%
Nvidia (NVDA) 7.83%
Micron Technology (MU) 7.45%
Broadcom (AVGO) 7.30%
Marvell Technology (MRVL) 4.53%
Analog Devices (ADI) 4.35%
Texas Instruments (TXN) 4.20%
KLA (KLAC) 3.98%
Qualcomm (QCOM) 3.95%

The heaviest damage was concentrated in the biggest holdings. Intel has shed more than 20% in two weeks, while AMD fell over 5% intraday on October 14.

What Has Turned Investors Against AI-Favorite Chip Stocks?

• Doubts about AI spending. OpenAI has reportedly informed investors that annualized revenue is approaching $50 billion, below earlier projections of $70 billion. Broadcom CEO Hock Tan has likewise called some AI investors gamblers.
• Higher inflation and rates. September consumer prices advanced 3.7% on a yearly basis, exceeding forecasts. Markets now assign a 92% probability that the Fed will raise rates again this year.
• Memory shares slump in Asia. The selling pressure spread from Korea's chip-heavy KOSPI. Meanwhile, advances by Chinese memory maker ChangXin Memory Technologies (CXMT) have raised concerns that China is gaining ground.

Demand is not the issue, however. Taiwan Semiconductor Manufacturing Company (TSMC) reported a 68.7% increase in third-quarter profit, yet its US-listed shares still slipped 1.8%.

Will the $500 Zone Hold?

SOXX sits under its 50-day moving average (MA), a level that limited gains in August and September. The Relative Strength Index (RSI), a measure of momentum, has slid to 36, its weakest reading since July.

Thursday's strong volume indicates buyers are moving in on dips. If sellers regain control, the next meaningful support is the 0.5 Fibonacci retracement in the $481 area.

To the upside, SOXX needs to recover $523 and the 50-day MA around $540. A larger obstacle stands at $573, the 0.236 Fibonacci level.

UBS frames the sell-off as a reset:

“More of a recalibration of expectations than a fundamental break in the AI investment story.”

JPMorgan strategists also signaled a possible turning point. Still, Goldman Sachs says Big Tech plans around $800 billion in capital spending this year. The next move for chip stocks may hinge on borrowing costs rather than demand.