markets

Matt Phillips12/12/25

Data center trade deep in the red

The data center trade is seeing its steepest sell-off since the market rout that was ignited by President Donald Trump’s Rose Garden tariff announcement back in April.

Goldman Sachs’ themed basket of AI data center shares was down more than 6% at around 12 p.m. ET, putting it on track for its worst day since the tariff announcement.

Losses hammered seemingly every form of input needed for the sprawling concrete server warehouses at the heart of the investment boom.

Hardware makers including data storage companies like Sandisk, Western Digital, and Seagate Technology Holdings, as well as DRAM maker Micron — some of the best-performing stocks in the S&P 500 this year — were taking a licking, as were networking stocks Cisco and Arista Networks and data center builders such as Vertiv Holdings and electrical and mechanical contractor Emcor.

Optimism for all things AI has seemed to evaporate throughout the week, as the stock market greeted lackluster quarterly numbers from Oracle and Broadcom with jittery sell-offs and concern about growing debts that could crater cash flows.

Those worries seem to be spreading to ancillary beneficiaries of the AI boom on Friday, gouging a chunk out of charts that retail dip buyers have not — at least so far — stepped in to buy as we head into the weekend.

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ASML drops after TSMC delays adoption of its newest chip-making machines until 2029

The iShares Semiconductor ETF took a brief leg lower after TSMC said that it would not deploy ASML’s most advanced machines for chip making through 2029 in a bid to save money.

Per Bloomberg, TSMC’s co-COO Kevin Zhang told reporters that ASML’s new offerings (high-NA EUV, for short) are “very, very expensive,” costing about $410 million.

Nonetheless, the Philadelphia Semiconductor Index (the basis for SOXX) is still poised to end the day by extending one record (for consecutive record closes) and setting another (for consecutive gains):

TSMC climbed to fresh highs after a brief blip. The foundry giant reported far better than expected profitability in its Q1 results last week, and delaying upgrading this equipment may be a sign of continued cost discipline to protect margins over time.

ASML fell as much as 4%, but pared losses to about 1% as of 3:19 p.m. ET.

Given TSMC’s stature in the industry, a couple thoughts:

a) You’d think TSMC would be the best-place to absorb any short-term cash flow hits from buying this more expensive equipment.

b) It doesn’t seem like the outputs of ASML’s most advanced technology will be ubiquitous until TSMC adopts their machines, given how prominent the Taiwanese company is in the foundry world.

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Poet Technologies surges as CFO confirms purchase order from Marvell, calls short sellers “maggots”

Shares of POET Technologies are continuing their parabolic surge after CFO Thomas Mika confirmed to StockTwits that the company would be booking revenues from custom chip and networking specialist Marvell Technology.

“We’re a supplier to Marvell now that they’ve acquired Celestial AI who has been a customer of ours for a couple of years,” he said. “And what we supply to Celestial AI are light sources, high-bandwidth, multi-frequency, high-power light sources that light up the photonic fabric that Celestial AI talks about as being the communication device between GPUs and one GPU and another GPU, a GPU and a memory device.”

Mika also said “I hate shorts” when asked about Wolfpack Research’s bet against the company, and said that short sellers were “maggots.” Wolfpack alleged that Poet’s US-based investors would be exposed to an “IRS tax nightmare.”

Personally, this explanation strikes me as pretty thin gruel. We’ve known since early December that Marvell was buying Celestial AI, and that Celestial AI is a Poet customer. Indeed, the stock got to surge when the deal was announced for that very reason! I can confirm that the sky is blue, I don’t know if that should be considered a catalyst to bid up the atmosphere.

On the other hand, you could do worse for a thesis these days than, “Hey, everything in the AI infrastructure supply chain seems to have mooned at one point or another recently, maybe let’s look for some names that mooned in 2025 that haven’t had their time in the sun in 2026!”

Poet’s in the connectivity space, which has been on fire in 2026. But shares had been down year-to-date before more than doubling over the past nine sessions.

The company’s rally once again includes massively bullish options action:

On a related note, Navitas Semiconductor is up double digits today and nearing its closing high from October, the latest in a series of current conditions we’re flagging as being eerily reminiscent of the market backdrop six months ago. Navitas is up more than 80% over the past nine sessions.

4 charts that show the speculative boom is back on

We’re so back.

BRITAIN-LONDON-FIREWORKS-NEW YEAR-CELEBRATION

The Future of the AI boom is coming into view

GE Vernova and Vertiv are giving us a glimpse into the future of the AI boom

GEV’s backlogs are bursting at the seams. One analyst told us he thinks that by the end of this year, GEV could be completely sold out of production capacity for heavy-duty turbines until 2029 or 2030.

Matt Phillips4h

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Max Knoblauch4h

Low-cost airlines plunge on report Trump administration is close to $500 million rescue deal for Spirit

Low-budget US airlines are sinking on Wednesday morning following a Wall Street Journal report that the Trump administration is close to making a rescue deal for Spirit Airlines, which is said to be nearing liquidation amid high fuel costs.

Shares of Frontier, Allegiant, JetBlue, and Southwest Airlines all dropped notably.

Per the WSJ, the US government could soon loan Spirit up to $500 million in return for warrants to take a sizable stake in the airline, which has filed for bankruptcy twice since late 2024. Those warrants could give the US government the ability to purchase as much as 90% ownership of Spirit, Bloomberg reports. The carrier has made efforts to emerge from its latest bankruptcy, filed in August, but fuel costs amid the war in Iran have upset the math.

On Tuesday, President Trump told CNBC he would “love somebody to buy Spirit.”

Exclusive | Trump Administration Nearing Rescue Deal for Spirit Airlines

Exclusive | Trump Administration Nearing Rescue Deal for Spirit Airlines

Per the WSJ, the US government could soon loan Spirit up to $500 million in return for warrants to take a sizable stake in the airline, which has filed for bankruptcy twice since late 2024. Those warrants could give the US government the ability to purchase as much as 90% ownership of Spirit, Bloomberg reports. The carrier has made efforts to emerge from its latest bankruptcy, filed in August, but fuel costs amid the war in Iran have upset the math.

On Tuesday, President Trump told CNBC he would “love somebody to buy Spirit.”

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