Memory chip stocks tumble on CXMT’s debut, Nvidia financing fears

Shares of South Korea's two largest chipmakers fell sharply on Tuesday, with Samsung Electronics dropping as much as 8% and SK Hynix sliding nearly 10%, as investors digested a potent combination of headwinds: renewed concerns over Nvidia's ↘ 1.47% circular financing arrangements and the explosive debut of Chinese memory rival CXMT on Shanghai's STAR Market.

Nvidia's $750 Billion Deal Spree Draws Scrutiny

The selloff came despite the announcement late Friday of a $500-billion-plus partnership between Nvidia and SK Group spanning AI factory construction and next-generation memory supply. Under the agreement, the two sides signed letters of intent to build more than 2 gigawatts of AI data centers on the Korean Peninsula and codevelop next-generation HBM memory solutions.investor.nvidia+1

But the sheer scale of Nvidia's deal-making — Bloomberg reported the company is working on AI infrastructure arrangements potentially worth more than $750 billion — revived investor anxiety about circular financing in the AI sector. Nvidia is also in discussions to guarantee as much as $250 billion to help OpenAI lease computing from a U.S. data center project and to finance $350 billion of OpenAI's chip purchases, according to Bloomberg. Critics have long warned that such arrangements, in which companies invest in each other or finance customer purchases of their own products, risk artificially inflating demand.finance.yahoo+1

CXMT's 470% Surge Amplifies Competition Fears

Adding to the pressure on Korean memory stocks was the debut of Changxin Memory Technologies on Monday, which saw shares surge roughly 470% above their IPO price of 8.66 yuan, giving the company a market capitalization of approximately 3.3 trillion yuan ($487 billion). The Hefei-based company raised 57.92 billion yuan ($8.6 billion) in Asia's largest IPO of 2026.reuters+2

CXMT is now the world's fourth-largest DRAM chipmaker by shipments, holding about 8% of the global market, with its share forecast to reach 11% by 2028, according to Counterpoint Research. Micron Technology ↘ 2.22% also fell, dropping 5%, while SanDisk sank 12% in sympathy.taipeitimes+1

Broader Context

The declines extend a bruising month for Korean chip stocks. The Kospi has been volatile throughout July, with SK Hynix having already fallen more than 11% over five sessions heading into Tuesday. Analysts noted a pattern of profit-taking on AI news this month, even as deal announcements have grown larger. The Philadelphia Semiconductor Index entered bear-market territory in mid-July, falling more than 20% from its late-June highs.seekingalpha+3

"CXMT plays a critical role in China's AI push, particularly in the face of US export controls," said Kyle Chan, a Brookings Institution fellow specializing in China technology policies.taipeitimes