U.S.-Listed Chip Stocks Shed $1.3T in Value as Semis Rout Spills Into Crypto
The semiconductor sector posted its steepest single-day drop in more than six years, erasing roughly $1.3 trillion in market value from U.S.-listed chipmakers on June 5. Risk assets sold off in tandem, with the crypto market losing an estimated $130 billion.
The Philadelphia Semiconductor Index (PHLX SOX) plunged 10.3% in one session, its biggest decline since the pandemic-driven turmoil of March 2020. Losses over the past two trading days widened to about 12%. The reversal comes after the group surged 73% year-to-date on AI-driven optimism.
Among major decliners, Marvell Technology fell 17%, Micron Technology dropped 13%, and Advanced Micro Devices slid about 11%. Nvidia, a bellwether for the AI chip trade, declined nearly 6%—a move that still translated into more than $300 billion in market capitalization wiped out in a single session. Broadcom sank about 8% despite posting strong results: Q2 revenue of $22.19 billion, up 48% year over year, and AI semiconductor revenue up 143% to $10.8 billion. Investors focused on Broadcom's Q3 guidance for custom AI chips, which came in below market expectations and sparked a wider valuation reset across the sector.
The selloff coincided with stronger-than-expected U.S. jobs data, reviving concerns that the Federal Reserve may keep interest rates higher for longer. The Nasdaq's nine-week winning streak ended the same day.
For crypto investors, the $130 billion drawdown reflected the same risk-off shift that hit high-growth and speculative assets. With both Broadcom's guidance and the jobs data adding uncertainty, rate-sensitive markets—including crypto—could remain under pressure if the "higher for longer" narrative strengthens.
Markets will now look to earnings guidance from other semiconductor leaders to see whether Broadcom's more cautious tone on custom AI chips is confirmed or proves idiosyncratic. A quick stabilization remains possible if the disappointment is isolated. The AI growth story is not disappearing overnight—143% year-over-year growth in the key revenue line underscores that—but the move highlights how quickly sentiment can turn when valuations get stretched, and how often crypto still reacts when tech stumbles.
