Shares of Intel (NASDAQ:INTC | INTC Price Prediction) are down 10% in Tuesday morning trading to $110, while Advanced Micro Devices (NASDAQ:AMD) stock is off 8% to $508. The moves cap a sharp reversal after both names rallied Monday.
The declines are part of a broader chip selloff triggered by Samsung Electronics’ quarterly report. Equipment maker Applied Materials (NASDAQ:AMAT) stock is leading the group lower, down 10% to $532, and the iShares Semiconductor ETF (NASDAQ:SOXX) is off 6% to $544.
Samsung’s Record Beat Sparks a Sector Reset
Samsung Electronics reported preliminary Q2 2026 operating profit of about $58 billion, a 19-fold jump from a year earlier that beat analyst estimates. Yet, Samsung shares fell 7%, and as much as 10% intraday in Seoul, on profit-taking after a 150% run this year, with Deutsche Bank flagging that the results were “only” 6% ahead of estimates.
That reaction bled into Intel, AMD, and Applied Materials during the U.S. session. The concern is whether these semiconductor and AI-adjacent companies can sustain the elevated sales and margins the market has already priced in.
Intel stock had gained on Monday on continued momentum from an extended Apple (NASDAQ:AAPL) partnership and a broad chip rebound, closing at $122.20. AMD stock closed Monday at $552.05 before today’s reversal. Both names have staged enormous 2026 runs into today’s session.
Why Applied Materials Stock Fell Fast
Applied Materials is bearing the brunt of the selloff because its major customers include Samsung, SK Hynix, Micron, and Intel. That customer mix leaves the equipment maker highly exposed to memory and AI capex sentiment, so Applied Materials shares tend to sell off rapidly when investors question the durability of that spending cycle.
Applied Materials stock had also climbed sharply into the report, with shares more than doubling in 2026 heading into today. CEO Gary Dickerson raised the full-year outlook in May and guided the semiconductor equipment business to grow more than 30% in calendar 2026, which sets a high bar for follow-through in coming quarters.
Broader Market Isn’t Collapsing
This is a chip-specific reset, not a market-wide risk-off day. The Dow closed at a record on Monday, and the CBOE Volatility Index sat at 15.81 on July 3, in the complacency range and down 14% over the prior week. The iShares Semiconductor ETF offer a diversified basket of chip stocks, though sector ETFs and individual chip names remain volatile, high-beta vehicles.
The bull case is still intact. Samsung’s profit was a record beat, high-bandwidth memory supply constraints are seen persisting well into 2027, and analysts last week framed the pullback as a “healthy reset” in an AI/semiconductor upcycle. The bear side notes that valuations are stretched after huge 2026 gains and that the AI trade is under fresh bubble scrutiny. AMD stock carries a P/E ratio of 208x, leaving little room for disappointment.
What to Watch
Traders can watch for whether Intel and AMD stabilize into the close and whether Applied Materials stock finds a bid as investors digest the capex read-through. The key question is whether Samsung’s profit-taking reaction marks a one-day reset or the start of a broader rethink of AI infrastructure valuations.
The takeaway: today’s move looks like a valuation check rather than a fundamental break. Samsung’s record beat confirms the memory and AI capex cycle is still working, but stretched multiples mean even good news can trigger sharp pullbacks. Watch how Applied Materials trades as the clearest read on capex sentiment, and how Intel and AMD hold up relative to their 2026 breakout levels.
Given how high-beta these names have become, investors should consider keeping position sizes modest through the volatility and wait for stabilization before considering adding exposure to the group.
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