Markets
AI chip stocks lost $1 trillion this week as TSMC posted a record profit
By the newsroom · · 2 min read · ▶ 1:03
The essentials
- The 20 most valuable AI and semiconductor stocks have shed more than $1 trillion in value so far this week.[1]
- Seoul's Kospi closed down 7.57% at 5,554.22 on Thursday, after a circuit breaker halted trading across the market for 20 minutes.[2]
- The sell-off followed US inflation data that raised the odds of another Federal Reserve rate hike this year to better than 96%.[2][3]
- TSMC reported third-quarter net income of NT$763.06 billion, up 68.7% from a year earlier.[4]
What happened
US consumer prices rose 0.6% in September, putting the 12-month rate at 3.7%.[3] Futures traders raised the odds of a rate hike when the Federal Open Market Committee next meets on October 27-28 to about 54%.[3] On Wall Street on Wednesday, the Nasdaq Composite dropped 1.88% to close at 26,692.87, while the S&P 500 shed 1.11% to end at 7,718.94.[1]
On Thursday, SK hynix sank 11.06% and Samsung Electronics plunged 9.48%.[2] Foreign investors sold shares worth 3.62 trillion won ($2.68 billion) on the bourse.[2] In Japan, SoftBank Group tumbled 7.9% and Advantest plunged almost 14%.[1] In Europe, ASML was last down 5.2%.[1]
The same day, TSMC said its third-quarter revenue rose 50.9% from a year earlier to NT$1,494.24 billion.[4] Its gross margin was 66.4% and its operating margin 58.7%.[4] CNBC reported that it was a record net profit for a sixth straight quarter.[5]
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What the video doesn't say
Investors are also worried about global memory chip oversupply as early as 2029.[1] China's ChangXin Memory Technologies, or CXMT, said it had made a breakthrough on a new architecture that could boost memory density.[1] Broadcom's Hock Tan said financing could be a bigger challenge to AI expansion than shortages of chips or electricity.[1] Analyst Dan Ives argued that "rates are a financing question, not a demand question".[1] TSMC's free cash flow surged to NT$476.56 billion in the third quarter, from NT$139.38 billion a year ago.[5]
What's next?
TSMC expects fourth-quarter revenue between US$52.3 billion and US$54.3 billion.[4] It also said mass production at its second fab in Arizona is expected to begin in the third quarter of 2027.[5]
Sources
- [1] CNBC, “Nvidia, AMD, Dell sell-off in global tech rout on AI funding worries”, October 15, 2026
- [2] The Korea Herald, “Kospi slides over 7% as chip stocks sink”, October 15, 2026
- [3] CNBC, “Consumer prices rose 3.7% annually in September as gas prices skyrocket”, October 14, 2026
- [4] sec.gov, “Document”
- [5] CNBC, “TSMC posts record profit for a sixth straight quarter, beating estimates on AI boom”, October 15, 2026
Image credits: 4300streetcar, https://commons.wikimedia.org/wiki/File:TSMC_Fab_14B_May_2025_2.jpg, CC BY 4.0, cropped ; hyolee2, https://commons.wikimedia.org/wiki/File:Korea_exchange.JPG, CC BY-SA 3.0, cropped ; PiDatacenters, https://commons.wikimedia.org/wiki/File:Racks_Amravati_Data_Center.jpg, CC BY-SA 4.0, cropped ; 4300streetcar, https://commons.wikimedia.org/wiki/File:SK_Hynix_DDR5_Tall_MRDIMM.jpg, CC BY 4.0, cropped ; 4300streetcar, https://commons.wikimedia.org/wiki/File:TSMC_Fab_6_front_May_2025.jpg, CC BY 4.0, cropped ; Purdue Engineering (YouTube), https://commons.wikimedia.org/wiki/File:A_semiconductor_wafer_being_removed_from_processing_equipment.jpg, CC BY 4.0, cropped
Written with the help of AI, reviewed before publication.How we work
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