Chip stocks suffer worst stretch in 16 months as AI fatigue grips the market

Semiconductor shares have posted their worst stretch in 16 months, a pullback that coincides with what analysts describe as growing AI fatigue among investors. After quarters of rallying on artificial-intelligence optimism, the market appears to be reassessing how quickly those investments will translate into earnings.

The shift in sentiment comes as attention turns to Anthropic's investor day. Wall Street has grown less patient with heavy AI spending, and the event is being watched as a test of whether companies can show tangible returns on the capital flowing into data centers, chips, and models. Chipmakers sit at the center of that spending cycle, which helps explain why they have borne the brunt of the caution.

For observers, the key question is whether this is a pause or a broader repricing of AI expectations. Signals to watch include capital-expenditure guidance, commentary on demand visibility, and whether Anthropic's disclosures reinforce or temper the spending narrative. Semiconductor demand remains tied to that narrative, so clarity from major AI players could shape sentiment across the sector in the sessions ahead.