Concerns over massive spending in the artificial intelligence sector, coupled with intensifying competition, have triggered a sharp sell-off in chip-related stocks, sending Japan's Nikkei 225 index down 4% and South Korea's KOSPI index plunging 7.5%.

Kioxia suffered the steepest drop on the Nikkei, falling as much as 18% in Tokyo trading. In Seoul, shares of SK Hynix and Samsung each declined by at least 8%, contributing heavily to the broader market downturn.