Nvidia's Global Technology Conference 2024 (GTC 2024) commenced with enthusiasm but offered no major surprises, leading to a modest sell-off in Nvidia stock, down 2.2% as of 11 a.m.
ET on Tuesday. Taiwan Semiconductor Manufacturing (TSM) stock also fell by 2.2%, and Intel dropped by 2.6%. Micron, which bundles its high bandwidth memory chips with Nvidia's AI chips, experienced a 1.5% sell-off.
Investors were likely disappointed by Nvidia's decision not to update its assessment of the total addressable market (TAM) for AI chips.
Despite announcing new products and partnerships, Nvidia's stance on TAM remained unchanged, impacting the outlook for Taiwan Semiconductor, Intel, and Micron.
Additionally, concerns arose regarding delays in the construction of semiconductor-related facilities in Arizona, affecting suppliers to Intel and TSMC.
High construction costs and labor challenges, coupled with delays in the companies' Arizona plant projects, contributed to the apprehension among investors.
While these developments may cause short-term fluctuations in semiconductor stocks, the long-term outlook remains positive.
The growing demand for AI chips and the potential completion of the Arizona plants could mitigate these concerns. It's important to monitor the situation, but these issues are not expected to pose significant risks to semiconductor stocks in the long run.