AI company stocks rebound after sell-off — MarketWatch
Shares of companies linked to artificial intelligence began recovering on Tuesday after the previous day’s sell-off, which was triggered by concerns over a more restrained approach by leading model developers to AI development and spending. MarketWatch reports.
Among chipmakers, shares of Qualcomm, Advanced Micro Devices, Marvell Technology and Arm Holdings rose notably. Nvidia, Intel and Micron Technology shares also gained, though less significantly. Server and component manufacturers, including Dell Technologies, Ciena and Hewlett Packard Enterprise, also showed positive momentum.
Demand for infrastructure
Gabelli Funds portfolio manager Hendy Susanto believes that even if Anthropic, OpenAI and other major labs slow the pace of developing advanced models, demand for AI infrastructure will remain high. In his assessment, second- and third-tier companies will seize the opportunity to catch up with the leaders.
Susanto named inference, enterprise AI and physical AI as future growth drivers. He also noted that major AI infrastructure companies expect demand to exceed supply at least through next year.
More current news is available on the UA.News Telegram channel Telegram.
Contracts and new capacity
According to Susanto, expanding production capacity in the semiconductor industry takes years, not quarters. Micron and other memory manufacturers have already announced plans to increase capacity over the coming years due to a sharp rise in demand. Previously, they had not rushed to take this step, fearing oversupply and falling prices.
Customers are also signing multiyear agreements for the supply of chips, networking equipment and other hardware. In Susanto’s view, this does not resemble the early phase of a downturn. At the same time, he noted that in high-risk segments, including next-generation optical communications, profitability depends on achieving technological milestones, so volatility and speculation are higher there.
Arista Networks shares rose 2.2% on Tuesday after falling nearly 6% on Monday. Coherent shares gained 1.8% after losing nearly 13% in the previous trading session.
