Thierry Borgeat Says Chip Stocks Peak Every Two Years. His Chart Points to Another Top
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Thierry Borgeat shared a weekly chart of the Philadelphia Semiconductor Index on X on November 13, 2026, with past cycle tops circled. He opened with “Zoom out, and the panic starts to look familiar.” Then: “Look for the little ovals. 2020. 2022. 2024. 2026. Roughly every two years, semiconductors climb into a cycle top, the party gets too loud, and the index falls.”
The Philadelphia Semiconductor Index, often called the SOX, tracks the largest U.S.-listed chip designers, manufacturers, and equipment makers. Chip stocks move in cycles because the industry tends to overbuild. Shortages push customers to double-order, chipmakers raise capital spending, and once inventory piles up, buyers pause orders until they work through it. Stock prices usually peak before earnings do, which is why tops tend to show up while results still look great.
Chip Leaders Have Already Dropped Hard
Recent price action matches the first half of Borgeat’s script. Over the past month, NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) fell 28.86%, Applied Materials (NASDAQ:AMAT) dropped 21%, Micron Technology (NASDAQ:MU) lost 19.53%, AMD (NASDAQ:AMD) slipped 12.32%, and Taiwan Semiconductor Manufacturing (NYSE:TSM) fell 10.74%. Broadcom (NASDAQ:AVGO) held up best, down 3.04%.
That slip made it the second-worst day on record for chip stocks. A sharp bounce followed, with AMD up 31.29% over the past week, before Friday’s session reversed part of it: AMD fell 9.29% and Micron 3.95% intraday.
Warning Signs That Back the Two-Year Pattern
Cycle tops usually show up first in memory, and Micron’s numbers are extreme. Non-GAAP gross margin hit 87.0%[1] in fiscal Q4 2026 versus 45.7% a year earlier, on revenue up 379.3% YoY, according to its earnings release filed with the SEC. The stock trades at 11 times trailing earnings and 4 times forward earnings. Memory stocks carry multiples that low when the market doubts peak profits will last. Micron’s CFO, Mark Murphy, acknowledged on the call that “eventually price increases would moderate.”[2]
Other late-cycle tells are showing up too. AMD’s inventory rose to $11.46 billion[3], up 35% sequentially. DRAM’s share of Applied Materials’ Semiconductor Systems revenue climbed to 33% from 28%[4], a sign that memory makers are spending heavily on capacity. Broadcom flags “cyclicality in the semiconductor industry undergoing profound change due to AI”[5] as a risk.
Why This Cycle Could Run Longer
The case against a clean repeat rests on contracts and supply limits. Micron said more than 75%[2] of fiscal 2027 shipments are already committed, and that it has “no line of sight to when supply and demand balance.” Broadcom forecast fiscal Q4 AI semiconductor revenue to $21.7 billion[5], up 236% YoY. AMD’s chief executive, Lisa Su, said: “Demand is higher than supply.” TSMC’s October revenue rose 59.7% YoY, and NVIDIA forecast fiscal Q3 2027 revenue to $108.0 billion ± 2%.
What Long-Term Chip Holders Need to Track Now
Borgeat’s chart fairly describes how chip stocks trade. They top on expectations while earnings are still rising, and that is the setup today. What sets this cycle apart is that order books are contracted years out, which raises the bar for the fundamental downturn that normally follows a price top. Expect the volatility to continue. The cycle has turned only when the hard data turns, and that shows up in four places:
- Memory pricing: Micron said HBM pricing increased significantly for calendar year ’27[2]. Price cuts would be the clearest sign of a top.
- Inventory conversion: AMD needs that inventory to turn into revenue near its Q4 guide of about $17 billion ± 3%[3].
- Equipment demand: Applied Materials forecast fiscal Q1 2027 revenue to $11.10B ± $500M[4]. A cut would point to capex digestion.
- TSMC monthly sales: These are the quickest public read on AI chip demand. A string of sequential declines would back Borgeat’s ovals.
If all four hold up, the latest drop looks like another valuation correction within an expansion that keeps going. If two or more crack, his two-year cycle is playing out again, and the harder question becomes when to step aside (we wrote a free handbook on riding a mania while planning the exit here: The Bubble Survivor’s Handbook).
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
