Key facts
- Asian semiconductor stocks climbed following Alphabet's announcement of up to $200 billion in AI computing power spending.
- SK Hynix and MediaTek Inc. saw significant share price increases.
- Chipmaker shares have experienced substantial surges in the first half of 2026.
- Samsung and SK Hynix reported increased demand for chips powering AI data centers.
- US chip companies like Sandisk and Western Digital also reported strong gains.
- Investors have been rotating out of software companies and into hardware stocks.
Asian semiconductor stocks experienced a notable increase, driven by Alphabet Inc.'s substantial planned investment of up to $200 billion in artificial intelligence computing power. This move has reignited optimism within the sector, signaling potential trickle-down benefits for chip manufacturers.
SK Hynix Inc., a key memory maker that derives over 7% of its sales from Alphabet, saw its shares climb as much as 6.5% in Seoul. Similarly, Taiwanese chip designer MediaTek Inc., reportedly developing custom processors for Alphabet, gained up to 5.2%.
Analysis indicates that shares in chipmakers underpinning the AI boom have surged significantly in the first half of 2026. Investors have favored semiconductor and memory chip manufacturers, whose profits have soared, over some large software companies that have fallen out of favor. The share prices of some chip companies have tripled or more since the start of the year, contributing to sharp gains in Asia Pacific stock markets.
South Korea's Kospi index has recorded its strongest first half since at least 1990, with a 123% increase year-to-date. This performance was largely fueled by electronics giants Samsung, whose share price rose 169%, and SK Hynix, which saw a 303% increase. Both companies have reported a significant rise in demand for chips required by AI companies for their data centers.
In parallel, US chipmakers have also experienced high demand. Sandisk shares are up 780% in 2026, and Western Digital has gained 240%, while Micron is up 296% and Seagate has risen 226%. Experts noted that these gains represent decades of typical growth compressed into six months, driven by demand exceeding constrained supply, leading to higher memory chip prices and explosive earnings growth.
However, signs of a potential faltering in the chip stock boom have emerged. Some investors have expressed reservations about the massive spending plans of leading AI companies, citing increased borrowing costs and cash flow impacts. This sentiment has led to a rotation out of tech stocks into other sectors, with some investors seeking to protect profits. Microsoft, for instance, is down 24% in 2026.