Asian chip stocks slide as Amazon spending and Intel forecast deepen AI funding fears

Asian semiconductor stocks fell sharply on October 30, 2026, as investors confronted the cost of sustaining the AI investment boom. Amazon’s huge capital-spending outlook and Intel’s weaker-than-expected sales forecast helped trigger the retreat, putting hardware suppliers under pressure even as parts of the cloud and data-center business continued growing rapidly.

SK Hynix fell almost 9%, Samsung lost more than 6%, and Japan’s Kioxia shed more than 9%, according to AFP’s Friday trading update. Advantest also declined more than 9%, while Taiwan’s TSMC lost more than 1%. These were trading snapshots, not final closing prices.

The losses followed another bruising session for US technology shares. Amazon dropped more than 7% in after-hours trading after losing more than 4% before the close. Alphabet fell more than 12% following soft advertising and search growth and plans to increase capital expenditure. The Nasdaq finished down more than 1%.

Amazon’s growth comes with a larger cash bill

Amazon’s October 29 earnings release kept its expected 2026 cash capital expenditures at approximately $220 billion. That was a reaffirmed forecast, not a newly announced increase. The figure covers the company’s spending on long-term assets; Amazon separately identified AI investment as the main driver of the increase in property and equipment purchases.

The pressure is visible in cash flow. Amazon generated $168.3 billion in operating cash over the trailing 12 months, up 29%. Yet free cash flow—the cash remaining after investment spending—turned negative. The company attributed that shift primarily to a $94.8 billion year-over-year increase in property and equipment purchases, net of sales proceeds and incentives.

That spending accompanied substantial growth, rather than a contraction in Amazon’s cloud business. AWS third-quarter sales rose more than 39% to $46 billion, its fastest growth in nearly five years. AWS operating income increased to $17.8 billion from $11.4 billion a year earlier. Across Amazon, operating income reached $28.1 billion, with a record operating margin of 13.9%.

Intel’s PC warning meets data-center demand

Intel’s outlook added a different concern. Its fourth-quarter revenue forecast of $15 billion to $16 billion fell short of market expectations, Bloomberg reported. Intel’s own results release put third-quarter revenue at $16.5 billion, up 21% year over year, making the forecast a sequential decline even after a growing quarter.

The company described sharply different conditions across its businesses. Chief financial officer David Zinsner expects the PC slowdown to continue at least through the first half of 2027. Chief executive Lip-Bu Tan, meanwhile, said Intel’s immediate priority was increasing supply to meet what he called extraordinary demand for its Xeon server processors.

• Client Computing and Physical AI revenue was $8.1 billion in the third quarter, down 5% year over year.
• Data Center and AI revenue reached $7.3 billion, up 78% over the same period.

For Floodlines Research founder Anna Wu, the risk concerns financing future expansion, not evidence that AI demand has already slowed. Higher funding costs and credit risk could eventually force the largest cloud operators to reduce their buildout, she told AFP. Her warning is conditional: the question is whether those companies can sustain the pace of investment, not simply whether customers still want more computing.