Shares of FormFactor, Penguin Solutions, Western Digital, Applied Materials, and KLA Corporation fell sharply after Samsung Electronics' record quarterly profit triggered a sell-the-news reaction, compounded by a Reuters report that China's DeepSeek is developing its own AI inference chip. Samsung's preliminary second-quarter operating profit of 89.4 trillion won surged 1,810% year-over-year, with revenue up 129% to 171 trillion won, beating consensus, but memory stocks had run up significantly ahead of the report, prompting profit-taking. The DeepSeek chip news revived structural fears that custom silicon could erode Nvidia's dominance, adding to concerns already raised by OpenAI's Broadcom-built inference chip and Anthropic's early talks with Samsung on a 2-nanometer accelerator. Morgan Stanley had earlier warned clients the AI rally was nearing its end and expected more capex discipline, while risks such as SK Hynix's planned Nasdaq debut and heavy insider selling further pressured the sector. FormFactor fell 10.2%, Applied Materials dropped 9.7%, Western Digital declined 9.1%, and both Penguin Solutions and KLA Corporation lost 8.4%.
Samsung Electronics Co LtdSamsung's record quarterly profit beat consensus but triggered sell-the-news reaction; the article does not clarify whether the profit-taking is a negative signal or just market dynamics.
NVIDIA CorporationDeepSeek developing its own AI inference chip, along with OpenAI's Broadcom chip and Anthropic's Samsung talks, threatens Nvidia's dominance.
Penguin Solutions, Inc.DeepSeek developing its own AI chip raises fears of reduced demand for Penguin Solutions' products if custom silicon displaces Nvidia's ecosystem.
Broadcom Inc
Applied Materials IncSamsung's record profit triggered sell-the-news in memory stocks, and DeepSeek's custom AI chip threatens demand for semiconductor equipment.
FormFactor IncSamsung's profit beat led to profit-taking in memory stocks, and DeepSeek's chip development raises fears of reduced demand for test/probe equipment.
KLA CorporationSamsung's earnings triggered sell-off in semiconductor stocks, and custom AI chips could reduce demand for inspection equipment.
SK Hynix IncPlanned Nasdaq debut and heavy insider selling pressure the stock, as mentioned in the article.
Western Digital CorporationSamsung's record profit triggered profit-taking in memory stocks, and DeepSeek chip news adds structural demand concerns for memory used in AI.
Morgan Stanley