Softbank suffers a double-digit drop, Nvidia crashes, shock for Samsung & SK Hynix: USA withdraws approvals from China

What exactly happened in the chip sector on Friday?

On Friday, November 21, 2025, a massive sell-off swept across Asian technology stock markets, hitting the chip sector particularly hard. Softbank, the Japanese technology conglomerate, saw its share price plummet by over ten percent in Tokyo. This sell-off was not an isolated incident but part of a broader sell-off affecting the entire region. South Korean memory chip manufacturer SK Hynix lost nearly ten percent of its value, while Samsung Electronics fell by over five percent. In Taiwan, TSMC, Nvidia's key manufacturing partner, slid by more than four percent.

What triggered this massive sell-off?

The immediate trigger for the sell-off was Nvidia's surprisingly weak share price reaction on Wall Street. Although the US chip manufacturer published exceptionally strong quarterly figures on November 19, 2025, and issued an optimistic forecast for the current quarter, the stock fell by over three percent the following evening. This paradoxical reaction, in which positive figures did not lead to a price increase, unsettled investors worldwide and signaled increasing nervousness in the market regarding valuations in the AI ​​sector.

How strong were Nvidia's actual quarterly results?

Nvidia's quarterly results were exceptionally impressive. Revenue surged from $35.08 billion in the same period last year to a remarkable $57.01 billion, a 62 percent increase. Quarterly profit jumped 65 percent year-over-year to $31.9 billion. Earnings per share came in at $1.30, significantly exceeding analysts' expectations of an average adjusted earnings per share of $1.26. For the current quarter, Nvidia forecasts revenue of $65 billion, far surpassing the average market expert forecast of $61.5 billion. These figures contradict clear assumptions of an AI bubble and confirm the robust demand for AI technologies.

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Why didn't strong figures lead to a price increase?

The answer lies in a fundamental shift in market psychology. Despite impressive results, investors reacted with profit-taking and caution. The stock relinquished all the gains it had made at the start of trading and ultimately closed down more than three percent. Analysts attribute this reaction to several factors: First, a series of profit-taking actions suggests that some investors, despite Nvidia's success, want to hedge their positions. Second, there is uncertainty about whether a potentially tighter interest rate environment could weigh on the business. Third, warning signals from several CEOs of financial firms such as Goldman Sachs and Morgan Stanley regarding valuations in the technology sector triggered additional caution.

What role did Softbank play in this market turmoil?

SoftBank is a key player in the AI ​​and chip sectors. In October 2025, the company surprisingly sold its entire stake in chipmaker Nvidia. The sale comprised 32.1 million shares and generated proceeds of $5.83 billion. The sale was only made public during the release of quarterly results on November 11, 2025. Although SoftBank divested its direct Nvidia shares, it retains a majority stake in ARM Holdings, the British chip designer indirectly linked to Nvidia. ARM's chip architectures are also used in Nvidia's processors. SoftBank's sell-off was not only a reaction to Nvidia's share price decline but also reflected a deeper uncertainty regarding valuations and the sustainability of the AI ​​boom.

Why did Softbank sell its stake in Nvidia?

Analysts interpret the SoftBank sale as a strategic profit-taking move to free up capital for even greater ambitions. SoftBank plans massive investments in various AI-related projects. The proceeds from the Nvidia sale, as well as from other divestitures, will flow into an ambitious portfolio of AI projects worth approximately $30 billion. This includes a planned total investment of $30 billion in OpenAI, the acquisition of chip designer Ampere Computing for $6.5 billion, participation in the Stargate project to finance gigantic data centers in the US, the acquisition of ABB's robotics division for $5.375 billion, and plans for a $1 trillion AI manufacturing center in Arizona. SoftBank CEO Masayoshi Son aims to position SoftBank as the central platform for next-generation AI infrastructure. The sale does not mean that Softbank is pessimistic about Nvidia, but rather that the company is using its profits to participate more directly in the AI ​​transformation, instead of just passively participating as a shareholder of Nvidia.

Which other institutional investors withdrew?

Softbank wasn't the only prominent investor to reduce its positions. Peter Thiel's hedge fund sold off its roughly $100 million stake in Nvidia. These moves by large, established investors signaled to the market a degree of profit-taking and caution regarding the extremely high valuations in the AI ​​sector. While these sales cannot be characterized as panic selling, they do demonstrate that even investors with strong confidence in the future of AI are hedging their positions.

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What are the concerns regarding an AI bubble?

In the weeks leading up to Nvidia's quarterly results, concerns grew on the stock markets about the economic sustainability of its massive investments in AI data centers and whether high expectations might have led to an overvaluation of tech stocks. These concerns were amplified by comments from Mark Zuckerberg, CEO of Meta, who spoke of excessive capacity, a move that subsequently caused his company to experience a 20% drop in value. Some analysts, such as James Schneider of Goldman Sachs, warn that Nvidia's self-financing for clients like OpenAI is increasingly resembling a circular business model, which could artificially inflate growth. Valuations for technology companies have rarely reached such extreme levels in the last 100 years.

How real is the threat of an AI bubble?

The threat of an AI bubble is real and multifaceted. While Nvidia's strong quarterly results convincingly demonstrate the robust demand for AI chips, several indicators warrant caution. First, the economic viability of large-scale AI infrastructure is not yet fully established. The ratio of added revenue to capital expenditure has declined in recent months. Second, Forrester analysts predict that a major high-tech vendor could reduce its AI infrastructure investments by 25 percent in 2025, driven by supply chain disruptions, unmet expectations, and investor pressure. Third, studies show that despite billions of dollars being invested in AI infrastructure and generative AI, only about 20 percent of companies reported profit increases from AI in 2024. This gap between AI infrastructure investments and the rather meager returns is concerning.

What global investments are planned in AI infrastructure?

The planned investments in AI infrastructure are exceptionally large. Estimates suggest that the cumulative investments required between 2025 and 2030 could reach almost $5.8 trillion. AI-related spending alone could reach almost $400 billion in 2025. By 2030, a global total of up to $7 trillion is projected. These enormous investment volumes are driven by the explosive growth in consumer and business demand for AI-powered services. In the US, with real GDP growth of around 1.5 percent in the second quarter of 2025, approximately 35 percent of this growth was attributable to investments in data centers, with this share potentially rising to over 50 percent in the second half of the year.

What opportunities does AI infrastructure offer for productivity?

Despite concerns about a bubble, there are also significant opportunities. Studies indicate an average productivity increase of around 30 percent in cases where generative AI has been used. With a current productivity base of 1.8 percent, this could translate into a productivity increase of 50 basis points. A sustained increase of this magnitude could reduce the projected U.S. debt-to-GDP ratio from 156 percent to 113 percent over the extended base period, according to the Congressional Budget Office. This would mean that productivity gains from AI could be potentially transformative for the global economy. AI investments could rival the productivity boom of the late 1990s, suggesting genuine economic transformation.

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What supply chain problems are impacting the chip sector?

The chip sector is under immense pressure due to various supply chain challenges. By 2025, the average delivery time will be 26 weeks, more than double the pre-pandemic level. Capacity bottlenecks between 2021 and 2025 resulted in delivery times of up to 22 weeks and losses exceeding €99 billion in the German automotive industry alone. Geopolitical developments and factors stemming from trade tensions, particularly rising tariffs and export restrictions between the US and China, have fundamentally altered procurement and manufacturing strategies. More than 75 percent of semiconductor companies are affected by such supply chain issues, especially in regions like Southeast Asia, where over-reliance on local suppliers makes companies vulnerable.

What impact do US trade restrictions have on South Korean chip manufacturers?

The US government's new restrictions on Samsung and SK Hynix's business in China have had a significant impact. The US Department of Commerce announced that it will revoke existing special permits allowing the companies to transfer American chip manufacturing technologies and equipment to their subsidiaries in China. This makes it more difficult for the South Korean chipmakers to modernize their production facilities in China. SK Hynix and Samsung, which dominate the global memory chip market, had previously benefited from exemptions to the sweeping export restrictions the US had imposed on China in the chip sector. SK Hynix and Samsung have located approximately 30 to 40 percent of their DRAM and NAND production in China. The announcement of the revocation of these permits has already led to share price corrections for both companies.

How is ARM positioning itself for the future of AI?

Arm Holdings, SoftBank's majority-owned subsidiary, is aggressively positioning itself in the AI ​​market. As part of SoftBank's vision to establish the group as an AI powerhouse, Arm Holdings aims to launch its first proprietary AI chips by 2025. The company is building a dedicated AI chip division and plans to develop the first prototype by spring 2025, with mass production slated to begin in autumn 2025. Arm Holdings is covering the initial development costs, with SoftBank contributing. To secure production capacity, SoftBank is already collaborating with Taiwan Semiconductor Manufacturing Co. This strategic move aims to move beyond a purely design- and licensing-focused approach and become more directly involved in AI chip production. This development signals that Arm Holdings not only intends to capitalize on Nvidia's success but could also become a competitor itself.

How do analysts interpret the technical chart situation at Nvidia?

From a technical perspective, analysts have been paying particular attention to Nvidia's 100-day moving average. This line is currently around $180. It is now crucial to defend this important technical support level to avoid a major sell signal. Models indicate a high probability of consolidation over the next four weeks within the $141 to $216 range, with the most likely scenario being slightly below the current price. The forecast suggests a moderate correction of around two percent, with no significant upward or downward swings expected. A break below the 100-day moving average could signal further declines. This technical situation reflects the underlying uncertainty among market participants.

What do analysts think about Nvidia's future development?

The analyst community is divided. Some, like Jefferies analyst Blayne Curtis, expect Nvidia's figures and comments to help stabilize AI trades through the year. They argue this should restore investor confidence in the long-term, strong demand forecast for AI. Harlan Sur of JPMorgan Chase emphasizes that Nvidia's strong performance across its extensive and complex supply chain underpins this trend, and that the chip designer's order book suggests demand will continue to outstrip supply in the short term. Other analysts are more cautious, pointing out that even a 62 percent revenue increase won't automatically lead to a stock rally if valuations are already too high. They cite the fact that Nvidia has lost roughly $500 billion in market capitalization in a short period.

How does the CEO of Nvidia respond to these concerns?

Nvidia CEO Jensen Huang has made it clear in his public statements that he does not share concerns about an AI bubble. Huang explained: "There's a lot of talk about an AI bubble. But from our perspective, we see something very different." According to him, many industries are only at the beginning of their transformation through AI with so-called agent software that can act independently and requires even more computing power in the background. Huang thus emphasizes that the demand for AI chips is still in its early stages and that significant growth could be on the horizon. This stands in stark contrast to the skeptical voices of other tech leaders like Mark Zuckerberg, who warn of overcapacity.

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What geopolitical risks are impacting the chip sector?

The chip sector is increasingly exposed to geopolitical risks. US export restrictions against China pose a significant challenge. Due to these restrictions, Nvidia is currently unable to sell high-end chips in the Chinese market. However, Nvidia's CFO, Colette Kress, reiterated that the company intends to regain access to the Chinese market, in part to secure the technological leadership of US companies worldwide. CEO Huang has repeatedly warned that the sales ban in China could encourage the emergence of strong local rivals. China is investing heavily in developing local AI chip and HBM manufacturing facilities to reduce its reliance on foreign suppliers. Countries, particularly the US and the European Union, are tightening regulations on semiconductor imports to safeguard domestic capacity in the face of escalating geopolitical tensions. These developments could lead to a global fragmentation of the semiconductor supply chain in the long term.

What opportunities arise from the current market downturn?

Some analysts see the current price corrections as opportunities for long-term investors. While the pullbacks could represent short-term profit-taking, they could offer attractive entry points for investors who believe in the long-term prospects of the AI ​​sector. The fact that Nvidia continues to deliver exceptional financial results suggests that the fundamentals for the chip sector remain intact. Analysts like the Jefferies team argue that the AI ​​trade is not dead and that stabilization by year-end is likely. Furthermore, new investments in chip production, both in the US and internationally, are opening up new business opportunities for specialized chip suppliers and manufacturers.

How will the semiconductor market develop by 2030?

The semiconductor market is projected to reach approximately €719.17 billion in revenue in 2025. The integrated circuit market will be the dominant segment, reaching a projected market volume of €531.56 billion in 2025. Revenue is expected to grow at an annual rate of 10.24 percent between 2025 and 2030, resulting in a projected market volume of €1.17 trillion in 2030. Global demand for semiconductors has risen sharply due to the increasing need for technological innovation and the ongoing digitalization in all countries. Globally, China is expected to account for the largest share of revenue, reaching €188.34 billion in 2025. This indicates that, despite current turbulence, the structural growth trend in the chip sector remains robust.

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