Intel and Advanced Micro Devices both extended their declines on Thursday, as a broad retreat in semiconductor shares continued for a seventh consecutive session and even a record quarterly report from Taiwan Semiconductor Manufacturing Co. failed to turn sentiment around.
Intel shares were down 3.84% in intraday trading, while AMD slipped roughly 3.77%. The two chipmakers have now posted a bruising stretch: AMD has closed higher in only one of its last seven sessions, and Intel has shed close to 20% of its value during October alone.
Chip stocks remain under pressure
The Philadelphia Semiconductor Index fell for a seventh straight session, a sign of how widely the selling has spread. Nvidia and other large chip names also traded lower, and TSMC could not escape the downdraft despite posting record quarterly results. The muted reaction to strong earnings suggests that company-specific performance is doing little to offset broader sector concerns.
At the center of investor anxiety is the scale of capital required to keep the artificial intelligence buildout going. Technology companies have committed enormous sums to data centers, advanced processors and computing infrastructure, yet questions persist about whether the returns will ultimately justify that spending.
Intel's chief executive recently pointed to access to capital and financing costs as key constraints on the industry's expansion, and stressed that companies will eventually need to show meaningful returns to shareholders. Those worries have been amplified by a sharp drop in CoreWeave's corporate bond prices, which added to unease about the financial risks tied to AI infrastructure investment. A selloff in the chip-heavy Korean equity market further weighed on sentiment.
Inflation adds to market pressure
The semiconductor pullback is unfolding against a difficult macroeconomic backdrop. US wholesale inflation for September climbed to its highest level since 2022, fueling concern that price pressures could keep interest rates elevated for longer.
Broader equities were mixed on Thursday. The Dow Jones Industrial Average gained more than 1%, the S&P 500 added 0.12%, and the Nasdaq Composite declined 0.3% at the time of writing. Treasury yields stayed relatively calm despite the inflation reading, but investors continued to weigh the odds of additional Federal Reserve tightening. UBS projected a third rate increase in March 2027, extending its forecast for the Fed's tightening cycle.
Higher rates can pressure equity valuations by raising borrowing costs and making bonds more appealing relative to stocks, a dynamic that tends to hit long-duration growth sectors such as semiconductors especially hard.
TSMC comments reopen questions for Intel
Intel also faces uncertainty tied to Elon Musk's Terafab initiative, a planned semiconductor manufacturing project intended to supply chips for Musk's businesses and their AI ambitions.
TSMC CEO CC Wei said the company remains in discussions about the project, raising fresh questions about whether the Taiwanese foundry could take an operational role in the proposed facility. "We are still in discussion, let me say that," Wei told analysts on TSMC's earnings call, according to Bloomberg. "But the fab has got to be run by TSMC," he added.
Those remarks contrast with comments from Musk a week earlier, when he indicated TSMC was not being considered for an operational role in Terafab. Intel has been linked to the project, making the possibility of TSMC's involvement particularly relevant for investors trying to gauge Intel's potential part in the venture.
This article is for informational purposes only and does not constitute financial advice.
