Axcelis Technologies falls 5.24% as tech rout deepens on AI spending fears

Axcelis Technologies sank 5.24% to $134.10 as a broad technology selloff driven by mounting concern over artificial intelligence capital expenditures swept across semiconductor and growth stocks.

The decline in Axcelis shares outpaced the broader market's drop, with the Nasdaq Composite falling 2.15% to 25,138 and the S&P 500 losing 1.21% to 7,408. The Dow Jones Industrial Average declined 0.97% to 51,712. Communication services and consumer cyclical stocks led the selloff, while industrials and healthcare posted relative strength.

Alphabet tumbled 7% and Tesla shares plunged almost 15% after both companies reported quarterly results that showed rising spending on AI infrastructure without clear timelines for returns. The 10-year Treasury yield rose 4 basis points to 4.67%, a 52-week high, adding pressure on growth stocks whose valuations depend on distant future cash flows. WTI crude oil gained 5.8% to $91.84 a barrel after reports of Houthi militia attacks on tankers in the Red Sea, compounding the risk-off mood in equities. Gold fell 2.36% to $4,048.76 as the dollar strengthened.

For Axcelis, a Beverly, Massachusetts-based supplier of ion implantation equipment to semiconductor manufacturers, the selloff comes ahead of its second-quarter earnings report scheduled for Aug. 6. The company's stock has declined more than 15% from its July high as investors reassess semiconductor equipment demand amid mixed signals from chipmakers on capacity expansion plans. Axcelis reported record quarterly revenue of just over $200 million in the first quarter, a 63.5% jump from a year earlier, but the broader sector's spending trajectory remains uncertain.

Intel rose in after-hours trading following its second-quarter results that beat analyst expectations, offering a potential bright spot for the semiconductor sector. The mixed signals from chipmakers underscore the uncertainty facing equipment suppliers like Axcelis, whose revenue depends on manufacturers' capital spending plans. The broader market's focus now shifts to next week's Federal Reserve meeting and a slate of additional technology earnings that will test whether the AI investment thesis can sustain current valuation levels across the sector.

This article is for informational purposes only and does not constitute investment advice.