Meta, Chip Stocks Face Test as AI Rally Wobbles — SkimNews
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- AI-linked stocks stumbled in recent days with sharp declines in semiconductor companies and tech hardware firms like Dell Technologies, while the broader S&P 500 remained only about 1% below its record high set this month.
- Meta Platforms headlines the coming earnings week, carrying a market cap of roughly US$1.9-trillion and having recently launched its Muse AI assistant; five AI hyperscalers combined are projected to boost capital spending to about US$1.2-trillion next year per Goldman Sachs.
- CoreWeave, an AI cloud company with about US$50-billion in debt, saw its shares tumble this week amid widening worries over the financing of the AI build-out boom.
- Lam Research and Texas Instruments report Wednesday, with both stocks up about 60% in 2026; the Philadelphia SE Semiconductor index has slumped 8% this month despite a 60%-plus year-to-date gain.
- S&P 500 companies are expected to post Q3 earnings growth exceeding 30% per LSEG IBES, driven by massive AI data-centre outlays that investors now want to see translated into profit.
- Deutsche Bank and RBC Capital Markets strategists separately pulled back tech-sector recommendations, with Deutsche Bank saying on Oct. 9 the rotation into tech had "run far and the risk-reward no longer looks favorable in the near term."
Why it matters: The AI trade's financial plumbing — not its technology — is now the market's central question. With $1.2-trillion in projected hyperscaler capex meeting rising capital costs and CoreWeave's $50-billion debt load rattling nerves, Meta's report becomes the first live test of whether the spending binge can still earn its keep. A 30%-plus earnings season is already priced in; what isn't priced in is whether returns follow.
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