What Happened?

A number of stocks fell in the morning session after the AVGO earnings overhang and the stronger-than-expected jobs report combined to drive one of the broadest global chip selloff of the year. 

The damage spread globally: South Korea's Kospi fell 5.5%, with Samsung down 6.4% and SK Hynix nearly 10%. European names followed: ASML fell 3.8% and Infineon lost more than 6%. Broadcom's guidance miss reset expectations for the pace of hyperscaler AI chip spending, removing the sector's most visible growth catalyst. The 172,000-payroll print then eliminated near-term rate cut hopes and introduced rate hike risk by year end per CME FedWatch. Semiconductor valuations, built on aggressive multi-year earnings assumptions, are acutely sensitive to these discount rate movements.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Processors and Graphics Chips company Intel (NASDAQ: INTC) fell 6.3%. Is now the time to buy Intel? Access our full analysis report here, it’s free.
• Memory Semiconductors company Micron (NASDAQ: MU) fell 6.1%. Is now the time to buy Micron? Access our full analysis report here, it’s free.

Zooming In On Intel (INTC)

Intel’s shares are extremely volatile and have had 51 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 2 days ago when the stock gained 4.3% on the news that the stock rebounded as CEO Lip-Bu Tan's Computex comments continued to cut through the noise. 

The move was notable given that Intel had fallen approximately 6% earlier in the week when Nvidia announced its RTX Spark PC chip. The same week's Computex news that initially hit Intel has since been more than offset by what Tan said about data center CPU demand. 

At a post-keynote press Q&A at Computex in Taipei, Tan revealed a supply problem most chip companies would consider a gift: "In the last four weeks, I have had all CEOs calling me, saying 'I need more CPU.'" Intel is supply-constrained on data center CPUs precisely because agentic AI is shifting the chip mix in Intel's favour. 

This matters because during the training era, AI deployments ran at roughly one CPU to four GPUs. Agentic AI, where a single agent can generate up to 1,000 times the tokens of a one-shot query, is compute-intensive in a different way: orchestration, reinforcement learning, and multi-step reasoning are CPU work, not GPU work. Tan put the ratio plainly: "for reinforcement learning, orchestration, and agents, the CPU is a much better fit." So, the ratio is becoming more like one-to-one, or shifting even more toward the CPU. 

Intel's Xeon dominates enterprise data centers, and data center chief Kevork Kechichian called it "the de facto standard." Intel also confirmed its 18A process has entered full mass production, launched Xeon 6+, and outlined Crescent Island, an air-cooled, inference-focused GPU targeting cost-sensitive workloads, with limited shipments expected by late 2026. 

Three analysts raised price targets: Wells Fargo to $110, Barclays to $100, and Mizuho to $128, all maintaining neutral ratings, flagging that Intel's valuation already reflects much of the agentic CPU thesis. The stock rose more than 300% since Lip-Bu Tan took the CEO role.

Intel is up 162% since the beginning of the year, but at $103.15 per share, it is still trading 20.3% below its 52-week high of $129.44 from May 2026. Investors who bought $1,000 worth of Intel’s shares 5 years ago would now be looking at an investment worth $1,807.

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