Facebook, which has been troubling investors in the U.S. stock market, rose after merely stating that it would "offer cloud services." Meanwhile, stocks of neighboring AI companies fell sharply, as this raised worries about weak AI demand and excessive production.
According to Bloomberg, published on July 1 (local time), "Meta possesses excess AI processing capabilities and is exploring the possibility of offering these services to outside clients as a means to establish an additional income source." Following this announcement, Meta's shares increased by 8.81% on that same day. This rise was fueled by hopes that the firm's profit margins, which had declined because of steeply rising costs associated with AI infrastructure development, might see improvement.
Meta's decision to use excess internal computing power for offering data center rental services sparked worries regarding low AI demand and excessive production. This development also triggered doubts that Meta could scale back its investments in AI infrastructure.
Consequently, widespread selling took place within AI-associated industries like data storage and network infrastructure. Nearly all 30 components of the Philadelphia Semiconductor Index declined.
Micron Technology, a memory chip manufacturer, saw its stock drop by 10.48%, even after revealing a positive long-term contract (LTA) to provide memory components for General Motors, America’s biggest carmaker. Meanwhile, Intel, Applied Materials, and Lam Research all declined more than 9%, with TSMC, AMD, and ASML slipping approximately 7%.
As a result, poor performance is anticipated for shares of Samsung Electronics and SK Hynix in the South Korean stock exchange on the 2nd.