Shares of technology companies fell as chip makers tumbled due to Broadcom's failure to meet lofty Wall Street expectations for artificial-intelligence revenue.

Shares of Broadcom fell by more than 10% after it reiterated the AI chip sales forecast it gave in its last report three months ago. Investors were blindsided by the conservative guidance, particularly in light of the massive $80 billion capital-raise plan disclosure from Google, which is Broadcom's largest AI chip customer.

The PHLX Sox Semiconductor index was down by more than 5% at one stage before recovering the bulk of its losses. The large-cap chip makers in the index have more than doubled in value, on average, in the last 12 months.

"Positioning has...reached levels that warrant a contrarian lens, particularly in the tech sector where exposure is becoming crowded and sentiment increasingly stretched," said Adam Turnquist, chief technical strategist at brokerage LPL Financial. "Signs of FOMO-driven activity are evident in elevated upside call buying."

Quantinuum stock popped in its trading debut, opening 13% above its initial public offering price in a major win for the quantum computing industry. Other quantum-computing stocks were mixed following a torrid run.

Chinese contract manufacturer Foxconn Technology Group and U.S. chip giant Intel are partnering to develop AI infrastructure, aiming to address critical bottlenecks in modern data centers.

Anthropic is calling for top AI labs to weigh slowing the pace of development, suggesting that AI systems are advancing so rapidly that they may soon be able to improve themselves without human intervention in ways that could pose significant societal risks.

Write to Rob Curran at rob.curran@dowjones.com

(END) Dow Jones Newswires

June 04, 2026 18:34 ET (22:34 GMT)

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