What If Chip Stocks Aren't in a Supercycle After All?

The article warns that the semiconductor rally, while robust this year, may be overextended and vulnerable to a correction if hyperscalers curb AI CapEx in 2027 and beyond. Higher interest rates and a change in AI spending cadence could prompt a digestion phase that dents chip stocks despite still-modest valuation multiples on a P/S basis. The piece argues investors should be prepared for volatility—a potential ‘vicious breather’ or rotation—while acknowledging a longer-term secular shift toward “silicon as infrastructure” could persist into the 2030s. Market impact: shorter-term downside risk for semis (and related names) if CapEx or rates bite, but possible buying opportunities before a next leg higher.