- The selloff erased more than $1 trillion in market capitalization from major global chip and AI-hardware stocks between the July 24 close and July 29 trading. Nvidia, SK Hynix, Samsung Electronics and Micron accounted for roughly $700 billion of the decline. [1] - SK Hynix reported record second-quarter revenue of 79.32 trillion won and operating profit of 60.54 trillion won, but both figures fell short of elevated analyst forecasts. Its Seoul-listed shares closed 9.6% lower Wednesday after falling 14.7% Tuesday. [2][3] - The decline combined several catalysts: reported Nvidia financing support for an OpenAI data-center project, concern about hyperscaler cash burn, China’s progress in memory chips and lithography, and expectations already embedded in semiconductor valuations. [3][4] - The trillion-dollar figure is a reduction in quoted market capitalization. It does not mean the companies lost that amount of cash or that investors collectively realized $1 trillion in losses.
More than $1 trillion in market capitalization was erased from a global group of semiconductor and AI-hardware stocks between the close on Friday, July 24, and trading on Wednesday, July 29. Nvidia, SK Hynix, Samsung Electronics and Micron produced roughly $700 billion of the decline, with losses at AMD, SanDisk, ASML, Kioxia, Arm, SoftBank and other chip-linked companies carrying the total past the trillion-dollar threshold.[1]
The total is necessarily approximate. U.S., South Korean, Japanese and European shares trade in different time zones and currencies, and Wednesday’s U.S. session was still underway when the tally was reported. The exact figure changes with the companies included, exchange rates and measurement time, but closing-price and market-cap data support the reported threshold.
The retreat continued despite strong evidence of current demand for AI memory. SK Hynix reported record second-quarter results Wednesday, including a 257% year-over-year increase in revenue and a more than sixfold rise in operating profit. Its shares still fell because the results missed forecasts and did not resolve concerns about how customers will finance the next stage of the AI buildout.[2]
Record earnings collided with still-higher expectations #
SK Hynix generated 79.32 trillion won in second-quarter revenue and 60.54 trillion won in operating profit, up from 22.23 trillion won and 9.21 trillion won a year earlier. Its operating margin reached 76%. A consensus compiled before the report had called for about 84.1 trillion won of revenue and 64.1 trillion won of operating profit.[2][5]
That gap mattered after a rally that had made SK Hynix one of the world’s most valuable chipmakers. Its shares fell 14.7% on Tuesday and another 9.6% Wednesday, after dropping as much as 20% during Wednesday’s session. Samsung declined 13.4% Tuesday and 5.2% Wednesday. The two companies’ weight in South Korea’s benchmark index helped push the KOSPI down 10.8% Tuesday and another 6% Wednesday, with circuit breakers interrupting trading on both days.[3][6]
The reaction did not follow a collapse in current demand. SK Hynix said AI adoption was supporting high-bandwidth memory, server DRAM and enterprise solid-state drives. The company began shipping HBM4 during the quarter and forecast that industry DRAM bit demand would grow by a percentage in the mid-20s this year. Those are management’s expectations, not independent proof of future orders, but they show that the selloff was not triggered by a disclosed cancellation of customer demand.[2]
Samsung encountered a similar response earlier in July. It forecast second-quarter operating profit of 89.4 trillion won, about 19 times its year-earlier result and above the prevailing analyst estimate. Its shares nevertheless finished that session 6.9% lower as investors questioned the durability of memory pricing and AI infrastructure spending.[7]
AI financing is under closer scrutiny #
The immediate pressure intensified after the Wall Street Journal reported that Nvidia could provide roughly $250 billion in financial guarantees connected to an OpenAI data-center project. Nvidia shares fell nearly 5% on Monday as investors considered whether the dominant AI-chip supplier might be assuming financing risk to support demand from a major customer.[3]
That report is separate from the partnership Nvidia and SK Group announced Friday. The companies described it as a $500 billion-plus initiative covering AI data centers and next-generation memory. It includes plans for SK Telecom to build an AI facility of up to 2 gigawatts using Nvidia’s Vera Rubin platform and for SK Hynix to supply and codevelop memory. Nvidia’s filing says the parties signed letters of intent, so the headline figure should not be read as a completed contract, an immediate capital expenditure commitment or guaranteed revenue for Nvidia.[8]
The scale of cloud-company spending has also become a source of pressure. Axios reported that Alphabet generated $39.1 billion in operating cash flow during the second quarter while recording $44.9 billion in capital expenditure, much of it tied to AI infrastructure. Microsoft and Meta were scheduled to report Wednesday, leaving chip shares exposed to any indication that major cloud companies were tightening budgets or relying more heavily on borrowing.[4]
There is not yet public evidence of a broad hyperscaler retreat from chip orders. The shift is in how markets are treating the spending: larger infrastructure announcements no longer automatically lift semiconductor shares when investors remain uncertain about financing costs, utilization and the eventual revenue generated by those assets.
China added a second source of uncertainty #
The selloff also followed the Shanghai debut of ChangXin Memory Technologies, or CXMT. Its shares rose nearly 470% on their first day, and the company raised at least $8.6 billion in the offering. The listing provided CXMT with additional capital to expand in commodity DRAM, where it competes more directly with Samsung, SK Hynix and Micron.[3][9]
Reports that a Chinese state-owned company had begun producing domestic immersion deep-ultraviolet lithography equipment broadened the concern to chipmaking tools. Such systems would not immediately replace the most advanced extreme-ultraviolet machines made by ASML, and important details about their performance and production scale remain undisclosed. A viable domestic DUV supply could nevertheless help Chinese manufacturers add capacity despite Western restrictions on equipment exports.[3][10]
Chinese open-source models created a separate demand question. Reuters reported that investors were assessing whether lower-cost models such as Moonshot AI’s Kimi K3 could deliver useful performance with fewer computing resources. More efficient models do not necessarily reduce aggregate chip demand because lower costs can encourage wider use, but the possibility matters when hardware valuations assume rapid growth in both AI workloads and the compute required for each workload.[3]
What the trillion-dollar decline measures #
Nvidia produced the largest individual U.S. contribution. Its shares closed at $206.84 Friday and $197.01 Tuesday, a 4.8% decline that reduced its market capitalization by about $238 billion. The stock weakened further during early Wednesday trading.[1][11]
CNBC’s tally placed the declines at roughly $176 billion for SK Hynix, $173 billion for Samsung and $113 billion for Micron over the measured period. Those figures, combined with Nvidia’s loss, account for about $700 billion. Broad declines among other memory producers, chip designers, equipment makers and AI-investment proxies pushed the aggregate above $1 trillion.[1]
The largest percentage declines were not always the largest losses in dollars. On Tuesday, Kioxia dropped 18.3%, SK Hynix 14.7%, Samsung 13.4% and MediaTek almost 10%. Nvidia’s smaller percentage decline erased more market value than most peers because its starting capitalization was much larger.[3]
Market capitalization is the current share price multiplied by shares outstanding. A falling stock price therefore reduces the quoted value assigned to all shares, even though only a fraction of them may have traded. A shareholder realizes a loss only by selling below the purchase price, and the calculation does not imply that an equivalent amount of cash left the companies or the financial system.
The selloff is ultimately a reassessment of expectations rather than a verdict that current semiconductor demand has disappeared. SK Hynix and Samsung are generating record profits, but their shares are being repriced around the duration of the memory cycle, the credit supporting AI projects, prospective Chinese supply and the returns cloud companies can earn from hundreds of billions of dollars in infrastructure. Samsung is scheduled to release detailed divisional results at 10 a.m. Korea time on Thursday, July 30.[2][7][12]
Companies mentioned #
Further sources #
[[1] CNBC, “Chip stocks shed more than $1 trillion as selloff hits companies powerin… ↗](https://www.cnbc.com/2026/07/29/chip-selloff-sk-hynix-samsung-softbank.html)
[[2] SK Hynix second-quarter 2026 results and market reaction, July 29, 2026. ↗](https://www.investing.com/news/earnings/sk-hynix-posts-record-q2-operating-profit-on-ai-memory-demand-4818390)
[3] Reuters, “Asian chip stocks slide as China competition fears rattle AI trade,” … ↗
[[4] Axios, “Investors cool on red-hot chip stocks,” July 29, 2026. ↗](https://www.axios.com/2026/07/29/chips-stocks-ai-china)
[[5] Yonhap News Agency, SK Hynix second-quarter consensus estimates, July 26, 2026. ↗](https://en.yna.co.kr/view/AEN20260726000800320)
[6] South Korean market close and circuit-breaker data for July 29, 2026. ↗+6 more
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