Memory Chip Stocks Surge 82% as Market Revalues AI Infrastructure, Magnificent Seven Lags With 1.1% Gain

According to Wall Street News, investment flows are shifting away from mega-cap tech companies toward AI infrastructure suppliers, particularly memory and semiconductor manufacturers, as the market reassesses which players will benefit most from expanding AI computing demand.

Year to date, the Nasdaq-100 has gained 18% and the S&P 500 up 10%, but an index tracking the seven largest tech stocks has risen only 1.1%. Meanwhile, the Philadelphia Semiconductor Index surged 82%, on pace for its best annual performance since 1999, with Micron (MU-US) and SanDisk (SNDK-US) among top performers. According to Bloomberg data, investors withdrew $786 million from the Roundhill Magnificent Seven ETF in June—the largest single-month outflow since its inception—while the Roundhill Memory ETF attracted $930 million in inflows.

Market sentiment has shifted due to concerns about whether mega-cap tech firms' massive AI infrastructure spending will generate proportional returns. Bloomberg industry research shows the seven largest tech companies' projected net profit growth rate for next year fell to 18.9% from 21.4% three months ago, while chip manufacturers' profit growth expectations rose sharply to 48.5% from 34.3%.