Asian Tech Stocks Slide as SK Hynix Drops Nearly 10% on AI Spending Fears

Key points

• SK Hynix, South Korea's largest memory chipmaker, fell 9.71% on Thursday, July 24, 2026.
• Samsung Electronics dropped 6.13% and Japan's Kioxia declined 8.84% in the same session.
• J.P. Morgan said in a Wednesday note that the Asian tech sell-off has not disrupted the AI investment cycle.
• S&P Global reported on August 5 that global output of tech equipment grew in July at its fastest pace since May 2021.
• SoftBank Group had surged more than 13% the previous day, illustrating the extreme swings hitting the sector.

Thursday was a rough day for anyone holding Asian technology shares. Stocks fell hard across the region, following a pullback overnight on Wall Street, as investors grew anxious about whether the enormous sums being poured into artificial intelligence can keep delivering returns.

The damage was sharpest in South Korea. SK Hynix, one of the world's biggest makers of high-bandwidth memory chips, a specialised type of computer memory designed to feed data to AI processors at very high speed, lost 9.71%. Samsung Electronics fell 6.13%. Seoul Semiconductor dropped 4.27%. We've tracked this pattern before: the same fear sent Asia chip stocks tumbling on July 20, and SK Hynix dropped 6.5% after its record-profit report on August 1, even as its fundamentals looked strong.

Japan felt it too. SoftBank Group slid 4.36%. Tokyo Electron, which makes chip manufacturing equipment, fell more than 5%. Kioxia, a Japanese flash-memory chipmaker, dropped 8.84%. Taiwan's TSMC, the world's largest contract chip manufacturer, meaning it makes chips designed by other companies, declined 1.46%.

The moves were jarring, but they came one day after SoftBank had soared more than 13%. That tells you how violently this market is swinging right now.

What is driving the volatility?

AI spending worries are the short answer. Some investors have started questioning whether big technology companies, often called hyperscalers, the giants who run massive cloud computing networks, will keep spending billions on AI infrastructure or eventually pull back.

J.P. Morgan pushed back on that fear directly in a Wednesday note, first reported by CNBC Tech. "We do not see any fundamental indicators that signal meaningful weakness in the next 6-12 months," the bank said, adding it doesn't expect hyperscalers to cut their AI budgets.

S&P Global's August 5 report supports that view: global output of tech equipment, as measured by the purchasing managers' index, a monthly survey of factory activity, grew in July at its fastest rate since May 2021, with software and IT services demand rising alongside it.

Should ordinary investors be worried?

Daily stock moves, even steep ones, rarely predict what a sector does over months or years. Anyone with savings in funds that hold semiconductor stocks, through a pension or a brokerage account, should expect continued short-term turbulence. The chip sector is tightly tied to AI sentiment, and that sentiment can shift fast. But the anxiety driving Thursday's sell-off isn't backed by the demand data J.P. Morgan and S&P Global are both pointing to.

What to watch: whether the hyperscalers' next round of earnings reports, due later this quarter, show any actual softening in AI capital expenditure. Until then, these swings reflect nerves, not a fundamental turn.

Common questions

Why do AI fears hit memory chip companies so hard?

AI systems consume enormous amounts of memory to process data. When investors worry about AI spending slowing, memory chipmakers like SK Hynix and Samsung are among the first stocks to fall because their biggest customers are AI data centres.

What is a hyperscaler, and why does its spending matter?

A hyperscaler is a company, such as Amazon or Microsoft, that runs very large cloud computing networks. They're the biggest buyers of AI chips, and their spending decisions move the whole semiconductor market.