Asian Chip Stocks Tumble Amid Nvidia-Led Market Pressure

Asian semiconductor stocks faced a steep selloff on Friday, led by SoftBank, following a surprising drop in Nvidia shares in the U.S., despite the tech giant reporting stronger-than-expected earnings.

SoftBank, which recently sold its Nvidia holdings but continues to control British chip designer Arm, plunged more than 10% in Tokyo. The conglomerate is also tied to several AI initiatives leveraging Nvidia technology, including the massive $500 billion Stargate project for U.S. data centers.

South Korea’s SK Hynix, a key supplier of high-bandwidth memory for AI applications, dropped 8.76%, while Samsung Electronics, another major memory supplier for Nvidia, fell 5.77%. Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest contract chipmaker and manufacturer of Nvidia’s designs, ended the session 4.81% lower.

Other notable declines included Hon Hai Precision Industry (Foxconn), down 4.86%, which manufactures server racks for AI workloads. Smaller suppliers were not spared: Japan’s Renesas Electronics fell 2.65%, Tokyo Electron was down 7.14%, Lasertec dropped 5.15%, and Advantest lost 12.1%.

The selloff comes despite Nvidia’s upbeat outlook for the fourth quarter. Analysts suggest the retreat reflects broader market concerns, including ongoing debate about an AI bubble, tighter financial conditions, and uncertainties around Federal Reserve rate cuts.

Friday’s decline highlights the sensitivity of Asian chip stocks to U.S. tech movements, particularly in the AI and semiconductor sectors, underscoring how interlinked global supply chains and investor sentiment have become.