Samsung, SK Hynix plunge as Broadcom AI outlook hits KOSPI

Samsung Electronics and SK Hynix fell sharply on Friday after Broadcom’s softer-than-expected AI-chip outlook triggered a selloff in US semiconductor stocks that spread to South Korea. The Korea Exchange briefly suspended programme trading by activating a sell-side sidecar.

The KOSPI opened 3.66% lower and dropped as much as 5.7% intraday. Samsung fell more than 5% in early trade and SK Hynix dropped nearly 7%, making the two chip makers the largest drags on the benchmark.

Broadcom reported strong overall quarterly results but guided about $16 billion in AI-semiconductor revenue for the current quarter — more than double a year earlier but below many investor expectations. Broadcom’s share price slid more than 12% in US trading and weakness extended across global markets before Seoul opened.

South Korea’s recent stock and export gains have been concentrated in memory chips used in AI servers and data centres. Samsung and SK Hynix dominate the global high-bandwidth memory market, and May export data showed a surge led by semiconductor shipments tied to AI infrastructure demand.

Analysts pointed to profit-taking after a strong rally in Korean technology shares, the timing of Broadcom’s update across time zones, and geopolitical uncertainty as factors that intensified selling. Goldman Sachs strategist Tim Moe warned the rally had been driven overwhelmingly by the AI hardware theme and that markets closely linked to a narrow group of exporters can be more vulnerable to shifts in global technology spending.

Researchers at the ASEAN+3 Macroeconomic Research Office cautioned South Korea remains exposed to external shocks through semiconductors, given its reliance on a limited set of US hyperscalers for much of AI demand. If AI capital spending slows or supply chains are disrupted, exports, corporate earnings, the currency and the broader market could be affected.

Market participants observed valuation gains, earnings upgrades and foreign inflows tied to AI left little room for disappointment, amplifying the market reaction when guidance fell short of expectations.