New York, January 31, 2026, 12:50 EST — The market has closed.
- The Philadelphia Semiconductor Index dropped roughly 3.9% on Friday, dragged down primarily by a steep decline in KLA.
- Next week’s chip earnings will dominate, as investors focus on guidance to gauge the sector’s direction.
- Concerns over rates and inflation have resurfaced, pushing the expectations higher for earnings in this pricey segment of the market.
Semiconductor shares tumbled into the weekend, with the Philadelphia Semiconductor Index closing Friday at 7,998.47, down roughly 3.9%. KLA Corp (KLAC.O), a key player in chip equipment, plunged 15.2%. The broader market slipped as investors digested President Donald Trump’s pick of former Federal Reserve Governor Kevin Warsh for Fed chair, alongside a hotter-than-forecast producer-price report. Adding to the pressure, Apple (AAPL.O) flagged rising memory-chip costs weighing on its profits. (FRED)
The pullback is significant since chip stocks have served as a crucial barometer for the AI boom—and for gauging how far investors are willing to pay for growth amid rate uncertainty.
Friday’s slide paves the way for a volatile week. Upcoming earnings will reveal if demand is broadening through the supply chain or remains concentrated among a few top players.
KLA’s latest results confirmed steady demand, but the bar was set higher. The chipmaking equipment maker beat revenue and profit estimates and issued a March-quarter outlook above analyst forecasts. Still, its shares dipped about 7% in after-hours trading and fell further during Friday’s regular session. “The stock had already sprinted into the print,” said Michael Ashley Schulman, chief investment officer at Running Point Capital Advisors, citing expectations that had outpaced the company’s guidance. (Reuters)
AI remains the group’s cornerstone, and the news kept coming after Friday’s close. Nvidia (NVDA.O) CEO Jensen Huang dismissed reports of internal hesitation over earlier plans, confirming the company is set for a “huge” investment in OpenAI. Speaking to reporters in Taipei, Huang said, “We are going to make a huge investment in OpenAI.” (Reuters)
Next week’s slate is packed. NXP Semiconductors (NXPI.O) will drop results after the close on Monday, Feb. 2, with its earnings call set for 8:00 a.m. EST Tuesday, Feb. 3. AMD (AMD.O) reports after the close on Feb. 3, followed by a conference call at 5:00 p.m. EST. Qualcomm (QCOM.O) releases earnings after the close Wednesday, Feb. 4, holding its call at 1:45 p.m. Pacific. Then onsemi (ON.O) is up next, reporting after the close Monday, Feb. 9, with a 5:00 p.m. Eastern call. (NXP Semiconductors)
Traders want clear signals. Is demand from data centers still driving chip sales and their manufacturing gear, or are lead times and order volumes leveling off? In the more cyclical sectors like autos, industrial, and phones, are inventories moving quickly enough to ease price pressure?
There’s a riskier route here. If inflation remains stubborn and yields climb, investors usually start slashing the priciest sectors first, with chip stocks right at the front. Even guidance described as “steady” rather than growing faster can trigger a reset in expectations, particularly following sharp gains.
U.S. markets reopen Monday, setting the stage for NXP’s after-hours report on Feb. 2. AMD follows closely with its earnings after the close on Feb. 3. Investors will see AMD’s results as an early gauge of where chip demand heads next.
