Shares of artificial intelligence chipmakers continued to decline on Friday, July 17, 2026, reflecting ongoing investor scrutiny of the AI industry. The downturn followed an earnings report from Taiwan Semiconductor Manufacturing Co. (TSMC) issued Thursday afternoon, which exceeded profit and revenue expectations but included plans for higher capital expenditure than previously forecast.

Even Nvidia, a leader in the AI chip sector, saw its share value drop 2.2% on Friday. Other major players also experienced losses: Intel slid 2%, Applied Materials tumbled 5.5%, and Advanced Micro Devices, with a market capitalization near $800 billion, fell more than 1%. The SMH index, tracking the 25 largest U.S. semiconductor firms, has dropped 9.5% compared to a month earlier.

The tech-heavy Nasdaq closed down 1.4% on Friday, while the S&P 500 fell nearly 1%.

Analysts suggest that in addition to profit-taking, the selloff may reflect jitters about the immense investment required for AI development. Wall Street is also anticipating a possible interest rate hike later this year, with futures markets indicating about a 52% chance of an increase in September, according to the CME Group's FedWatch Tool.

Nvidia CEO Jensen Huang was recently seen speaking after attending the AI Ecosystem Reception in Tokyo on July 16, 2026.

Sources