NVIDIA (NASDAQ:NVDA) Chief Executive Jensen Huang disputed the severity of last week’s semiconductor downturn on Monday, saying investors should view the rout as a chance to buy rather than evidence that AI demand has weakened structurally. "We are at the outset of the AI revolution," Huang said, framing the $1 trillion-plus sell-off across chip stocks as a short-term positioning event.
The sharp losses in the sector were largely concentrated on June 5, the single worst session for semiconductor equities since March 2020. On that day Nvidia dropped $13.56 per share, a fall of 6.2%.
Two principal triggers were cited for the selling. A May jobs report showing 172,000 new payrolls - more than double analysts' expectations - heightened concern that the Federal Reserve might respond with higher interest rates. Separately, Broadcom delivered softer-than-expected AI chip guidance for the prior quarter, which had already introduced doubts about whether ambitious AI capital expenditure plans could be sustained.
In the immediate wake of the June 5 rout, some market professionals echoed Huang’s view that the move reflected positioning rather than a collapse of fundamentals. Wells Fargo Chief Equity Strategist Ohsung Kwon said the semiconductor group had been "way overbought," which he cited as the proximate reason for the sell-off. "I don't think it's the end of the semi bull market," Kwon added.
UBS Global Wealth Management Chief Investment Officer Mark Haefele also offered a tempered assessment on Monday, noting that "although tech stocks have come under pressure in recent days amid concerns about whether expectations can be met, business fundamentals remain strong."
Still, critical voices persisted. Analysts cited by Fortune warned that the Nasdaq's pullback evoked 1999-style bubble dynamics, with one of those analysts asserting that 2026 "looks uncomfortably like" that earlier era and questioning whether current AI valuations can be maintained without prompt rate cuts.
The scale of recent moves is reflected in index and stock performance figures reported around the episode: the Nasdaq 100 fell 4.77%, the S&P 500 was down 2.64%, Nvidia posted a 6.2% decline, Micron dropped 13.25%, and Broadcom declined 7.92%.
Ahead of the market open, futures showed some partial recovery: S&P 500 futures were up 0.9% and NASDAQ 100 futures were up 1.9%. Nvidia, Broadcom and Micron were indicated to be trading higher premarket by 2.7%, 3.3% and 8.3%, respectively. Nvidia's 52-week high is listed at $236.54, implying there remains room for a rebound despite recent weakness and the modest premarket bounce.
Context and market implications
Huang’s comments underline a view among some market participants that the AI-driven demand story for semiconductors remains intact despite recent volatility. At the same time, the episode highlighted how macroeconomic indicators - such as an unexpectedly hot payrolls print - and company-specific guidance can trigger sharp re-pricing in richly valued technology and semiconductor names.