Chipmaker stocks will weather any AI slowdown

ONE fear over the past few days is that an artificial-intelligence slowdown, whatever that looks like, might harm the stocks of chipmakers. If AI development takes a breather, the insatiable appetite that has propelled component makers to unprecedented heights would dissipate.

Will AI companies still need all those data centres? The answer is yes. And then some.

The 6 per cent drop in the Philadelphia Semiconductor Index – which tracks the shares of top chipmakers like Nvidia and Intel – over the past five days, as AI doom fears have captured the news agenda, is an understandable reaction to the uncertainty created by hyperbolic but not entirely unwarranted talk of an AI-created catastrophe.