SoftBank slumps greater than 10% as Nvidia-driven decline takes maintain of Asian chip shares

The logo of Japanese company SoftBank Group is seen in front of the company’s headquarters in Tokyo on January 22, 2025.

Kazuhiro Nogi | Afp | Getty Images

A sector-wide decline hit Asian chip stocks on Friday, led by a sharp decline SoftBankafter NvidiaThe sharp drop overnight contradicted better-than-expected earnings and optimistic outlook.

SoftBank plunged more than 10% in Tokyo. The Japanese technology group recently sold off its Nvidia shares, but still controls the British semiconductor company Arm, which supplies Nvidia with chip architecture and designs.

SoftBank is also involved in a number of AI projects that use Nvidia’s technology, including the $500 billion Stargate data center project in the US

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South Korea’s SK Hynix fell 8.76%. The memory chip maker is Nvidia’s leading supplier of high-bandwidth memory used in AI applications. Samsung electronicsa rival that also supplies memory to Nvidia fell 5.77%.

Taiwan Semiconductor Manufacturing Company, The world’s largest contract chipmaker and maker of Nvidia’s chip designs ended the trading session down 4.81%.

Taiwan Hon Hai precision industryalso known as Foxconn, which makes server racks designed for AI workloads, fell 4.86%.

The decline by the major Asian semiconductor giants comes after Nvidia fell over 3% in the U.S. on Thursday, despite third-quarter earnings beating Wall Street expectations the night before.

The company also gave stronger-than-expected fourth-quarter revenue guidance, which analysts said could boost profit expectations across the sector.

Billy Toh, regional head of retail research at CGS International Securities Singapore, said Nvidia fell victim to a combination of a Bitcoin sell-off, the possibility of a delayed Fed rate cut and generally tighter financial conditions.

“Add to this the ongoing talk of an AI bubble triggering a broader risk-off rotation, and Nvidia naturally becomes one of the first pressure points,” he told CNBC.

Even smaller chip players in Asia were not spared. In Tokyo, Renesas Electronics, a key Nvidia supplier, fell 2.65%. Tokyo Electron, which supplies foundries that make Nvidia chips with basic chipmaking equipment, fell 7.14%.

Another Japanese chip equipment maker, Lasertec, lost 5.15% Advantage stumbled by 12.1%.