Memory price surge backfires on end-user demand! Apple price hikes + OpenAI IPO delay trigger crash in Asian chip stocks

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On Friday, Asian chip stocks collapsed again.

The Korean Kospi index plunged as much as 9% during trading, triggering a 20-minute trading halt—this is the second circuit breaker this week. Samsung Electronics and SK Hynix both dropped 8%-10% intraday, with foreign investors net selling Korean stocks worth 5 trillion won (about $3.2 billion) in a single day. Meanwhile, the MSCI Asia Pacific Information Technology Index fell over 6% in one day, Japan's Kioxia dropped more than 12%, and SoftBank Group plummeted 14%. Nasdaq 100 futures also fell more than 1.5%, putting pressure on US markets at the opening.

This selloff was triggered by two major news events.

First, Apple implemented an unusual large-scale price increase for Mac, iPad, and multiple hardware products, citing a shortage of memory chips, with the biggest increase reaching $500. The move was read by the market as a clear signal: The pricing power brought by memory supply bottlenecks is forcing investors to broadly reprice AI-related semiconductor stocks at the expense of future demand.

Second, The New York Times reported that OpenAI is considering postponing its IPO to next year or even to 2027. The combination of these two events sparked concentrated concerns over the outlook for AI hardware demand and the valuation of AI concept stocks.

Homin Lee, strategist at Singapore's Lombard Bank, said this decline is likely due to "rumors of a US IPO delay and Apple's price increase."

Price hikes shift from positive to concern, shifting trading logic?

Earlier this week, Micron Technology released optimistic earnings guidance, and SK Hynix announced plans to list in the US, briefly rekindling market optimism and causing a strong rebound in the Korean stock market on Thursday. However, news of Apple’s price hike quickly reversed the momentum. Meanwhile, Microsoft also announced a third price increase for Xbox consoles on the same day, with some models reaching $800.

Apple CEO Tim Cook described this supply crisis as a "once-in-a-century flood," saying "in over 40 years in the industry, I've never seen a single component's price rise so much and so fast." Apple stated that the rapid expansion of AI data centers has caused a surge in extraordinary demand for memory and storage.

As a result, the market began reassessing: Will the expansion of chip stock profits brought by rising memory prices come at the cost of suppressing end-consumer demand?

Homin Lee, strategist at Singapore's Lombard Bank, said this decline most likely comes from "rumors of IPO delay and Apple's price hike," and that these developments add new uncertainties to the ongoing debate about the extremes of memory bottlenecks.

Analysts believe that Apple's price hike is one of the clearest signals yet: The pricing power conferred by tight upstream chip supply may now be transmitting to end consumers and ultimately undermining demand. This shift in logic marks a more cautious market approach to the AI hardware investment theme.

This cost pressure isn’t limited to consumer electronics. According to the US Department of Labor, consumer computer software and accessories prices rose about 15% year-on-year in May, while wholesale prices for electronic components and accessories surged 27% year-on-year. Morgan Stanley research this month found that memory prices have risen sixfold over the past year, dubbing this “chipflation” and attributing it directly to AI hyperscale enterprises crowding out the consumer memory market.

On Thursday, The Wall Street Journal wrote that the AI infrastructure boom is creating America’s third inflation wave. Unlike one-off shocks from tariffs or oil prices, AI-driven demand shocks could last for years.

OpenAI delays IPO: AI valuations under pressure

Meanwhile, The New York Times reported Thursday, citing three insiders, that OpenAI is considering postponing its IPO to next year. Advisers have suggested two options to company executives: wait until 2027 to go public at a $1 trillion valuation or lower the target valuation for a faster IPO window. CEO Sam Altman made it clear that lowering the trillion-dollar valuation is not under consideration.

According to previous Reuters reports, OpenAI has secretly filed for a US IPO with a $1 trillion valuation target. Uncertainty in the timetable has cast doubt among investors about whether high AI concept stock valuations can be soon validated with liquidity.

SoftBank, as a major supporter of OpenAI, saw its shares in Tokyo tumble 14%. IG International market analyst Fabien Yip said: "The potential OpenAI IPO delay reflects recent volatility in tech stocks affecting retail investor enthusiasm. This has brought a real test to AI valuations."

Kospi extreme volatility: leveraged trades amplify market fragility

Korean stocks have been subject to extreme volatility this year. Since 2000, Kospi has triggered 11 circuit breakers, five of which occurred this year alone. The Kospi 200 Volatility Index has hit new highs over the past two trading days and is now about five times higher than the US Cboe Volatility Index.

This situation is closely related to structural features of the Korean market. High retail investor reliance on margin trading and the widespread popularity of leveraged ETFs tracking chip stocks together amplify market swings. Leveraged ETFs, due to their daily rebalancing mechanism, systematically worsen volatility during unilateral market moves.

Samsung Electronics and SK Hynix together account for nearly 60% of the Kospi index's weight, making price swings of these two companies decisive for the overall index. Some analysts have compared intraday volatility in this market to the "meme stock frenzy". After the week’s close, there were large block options trades, including one with a notional value exceeding 1.5 trillion won involving Kospi 200, Nikkei 225, Samsung, and SK Hynix. Options open interest on Samsung and SK Hynix is near historic highs.

Daniel Tan, portfolio manager at Grasshopper Asset Management, said: "Volatility without a clear direction is painful for trading. We're watching to see where consolidation happens before considering whether to add more tech stocks."

Risk Warning and DisclaimerThe market carries risks, and investment requires caution. This article does not constitute personal investment advice and does not take into account individual users' special investment goals, financial situations, or needs. Users should consider whether any opinions, perspectives, or conclusions in this article are appropriate for their own circumstances. Invest accordingly, and you are responsible for the outcome. ```