By Hannah Pedone

Anticipation is building for Anthropic's investor day as Wall Street grows less patient with heavy AI spending

Of the 30 chip stocks in the PHLX Semiconductor Index, 22 are more than 20% below their record highs.

Chip stocks haven't suffered a losing streak like this in almost a year and a half. The big question for investors is what could snap the semiconductor sector out of its doldrums.

First, it's worth looking at what's driven chip stocks lower across the past five sessions. Jefferies analyst Jeffrey Favuzza wrote in a Tuesday trading note that one of the biggest questions he has been getting from clients is "'why the weakness in AI?' across the board."

He believes that there are a number of factors at play, including recent commentary from Broadcom (AVGO) CEO Hock Tan about how capital, or funding, could the biggest bottleneck in the AI buildout. But perhaps the "bigger issue," according to Favuzza, is the anticipation and uncertainty around Anthropic's investor day that's reportedly on tap for Wednesday.

He wrote that most investors are looking to see upward of $80 billion in annual recurring revenue from Anthropic.

Semiconductor investors are clearly on edge heading into the event, though the worries go deeper. The iShares Semiconductor ETF SOXX, a proxy for chip stocks, is down for the fifth consecutive trading day and pacing toward its longest losing since May 23, 2025, according to Dow Jones Market Data. Meanwhile, 22 of the 30 stocks in the PHLX Semiconductor Index SOX are off more than 20% from their record highs, nearly all of which were achieved in May or June.

SK Hynix (SKHY) and Cerebras Systems (CBRS) shares aren't in that index but have been two of the sector's biggest laggards recently. SK Hynix's stock has been down for seven consecutive trading days, losing 20% over that period, while Cerebras shares have been down for six consecutive trading days, shedding nearly 20% as well.

Daniel O'Regan, managing director for equity trading at Mizuho, wrote in a note that over the past several weeks, there has been growing evidence that investors are "becoming less willing to fund AI-related spending at any price."

He wrote that capital spending on AI has outpaced free-cash-flow generation, meaning that companies have needed to tap external financing for hardware purchases. If that financing becomes tougher to come by, it could dent spending on chips and other forms of AI infrastructure.

-Hannah Pedone

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