SK Hynix files for $29B Nasdaq listing amid AI stock selloff

SK Hynix filed for a landmark Nasdaq ADR listing, planning to raise up to $29 billion to fund chip manufacturing expansion, according to Reuters.reuters
The filing came as the Nasdaq Composite fell sharply Tuesday, with the semiconductor index plunging amid fears that AI capital spending is crushing free cash flow at major tech firms.reuters+1
The "Magnificent Seven" plus Broadcom and Oracle have lost roughly $2.7 trillion in market cap this June, per Yahoo Finance.finance.yahoo

A broad selloff in technology stocks deepened on Tuesday, June 23, as investors reassessed the sustainability of hundreds of billions of dollars in artificial intelligence infrastructure spending by the world's largest tech companies. The Nasdaq Composite fell 2.2% while the S&P 500 dropped 1.4%, with semiconductor stocks bearing the worst of the damage as the Philadelphia SE Semiconductor Index plunged 7.9%.reuters+1

The Cash Flow Crunch

The selloff reflects mounting anxiety over free cash flow deterioration at the so-called hyperscalers. Alphabet's first-quarter 2026 free cash flow fell 47% year-over-year to $10.12 billion, while Amazon's Amazon.com, Inc. trailing twelve-month free cash flow collapsed to just $1.2 billion from $25.9 billion a year earlier. The combined 2026 capital expenditure plans from Microsoft , Alphabet, Amazon, and Meta now approach $700 billion, representing a more than 60% increase over 2025 levels. CreditSights estimates roughly 75% of that total — about $450 billion — flows directly into AI infrastructure including GPUs, servers, and data centers.cnbc+4

The "Magnificent Seven" plus Broadcom and Oracle have shed roughly $2.7 trillion in market capitalization during June, according to Yahoo Finance.finance.yahoo

Dueling Outlooks

J.P. Morgan's JPMorgan Chase & Co. midyear 2026 outlook offered a counterpoint, arguing that stocks "are supported by strong earnings due to the AI capex buildout" and that "the climate is still one that favors the AI capex supply chain". The firm projected U.S. GDP growth accelerating to roughly 3.0% in the second and third quarters, powered in part by surging investment spending from tech giants racing to capitalize on AI.jpmorgan

Meanwhile, SK Hynix filed its F-1 registration with the SEC on June 24 for a landmark $29 billion Nasdaq ADR listing — potentially one of the largest share offerings in history. The South Korean memory chipmaker, which supplies high-bandwidth memory chips to Nvidia , plans to begin trading on July 10 and will use proceeds to expand chip manufacturing capacity.reuters+1

Market Crosscurrents

The selloff was amplified by broader macroeconomic concerns, including expectations of a more aggressive stance from the Federal Reserve amid inflation that hit a three-year high of 4.2% in May, according to J.P. Morgan. The CBOE Volatility Index surged to 19.52, its highest level in over a week. Intel , Nvidia, Oracle, and Tesla each fell 4% or more on Tuesday, extending losses from the prior session.wsj+2

The central question facing markets remains whether AI revenue can eventually justify the scale of investment. As Bank of America noted earlier this year, hyperscaler capital expenditures now consume 94% of operating cash flows after dividends and buybacks — a figure that leaves little margin for error if AI monetization timelines stretch further than expected.investing

Sources (39)