Wall Street Is Worried About a ‘Sizzling’ Semiconductor Trade. History Says Cooling Periods Like This Set Up the Next Leg Higher Jeremy PhillipsThu, May 14, 2026 at 12:03 AM UTC 0 Slaven Vlasic / Getty Images Entertainment via Getty ImagesQuick Read Nvidia (NVDA) reported Q4 fiscal 2026 revenue of $68.13B, up 73.2% year over year with Data Center networking up 263%, and guided Q1 to roughly $78B. AMD (AMD) delivered Q1 2026 revenue of $10.25B with Data Center up 57% year over year and Q2 guidance of $11.
Wall Street Is Worried About a ‘Sizzling’ Semiconductor Trade. History Says Cooling Periods Like This Set Up the Next Leg Higher
Jeremy PhillipsThu, May 14, 2026 at 12:03 AM UTC
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Slaven Vlasic / Getty Images Entertainment via Getty ImagesQuick Read -
Nvidia (NVDA) reported Q4 fiscal 2026 revenue of $68.13B, up 73.2% year over year with Data Center networking up 263%, and guided Q1 to roughly $78B. AMD (AMD) delivered Q1 2026 revenue of $10.25B with Data Center up 57% year over year and Q2 guidance of $11.2B, while the iShares Semiconductor ETF is up 71% year to date despite recent sentiment swings.
B200 GPU rental prices fell 30% over a weekend and sentiment metrics deteriorated sharply, but historical analysis shows NVIDIA has weathered similar cooling periods in 2017, 2019, and 2022 before launching new highs, suggesting current anxiety reflects a temporary pause rather than demand reset.
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Although the chip complex has spent the last six months looking unstoppable, Wall Street is starting to whisper that the heat may finally be coming out of the trade. A Reuters analysis is warning that the "sizzling" semiconductor trade is at risk of cooling and could stall the broader US stocks rally. The iShares Semiconductor ETF has vaulted roughly 71% year to date, and individual leaders have run even harder. But the chatter on trading desks, and on Reddit, has shifted from euphoria to anxiety in a matter of days. What's particularly notable is that history has seen this movie before, and it usually ends with another leg higher rather than a top.
The Sizzle, Quantified
Start with the anchor everyone is staring at. NVIDIA (NASDAQ:NVDA) carries a market capitalization north of $5.3 trillion and trades around $226.57 after a roughly 80% one-year run. AMD (NASDAQ:AMD) has skyrocketed roughly 109% year to date and roughly 315% over the past year. Intel (NASDAQ:INTC), long the laggard, has piled on a roughly 227% YTD gain. Equipment supplier ASML (NASDAQ:ASML) is up roughly 43%, and Qualcomm (NASDAQ:QCOM) has tacked on roughly 24%.
The cooling worry is real. B200 Blackwell GPU rental prices fell roughly 30% over a weekend. NVDA sentiment swung from 72 bullish to 22 bearish inside 24 hours. QCOM sentiment has fallen from 82 very bullish in early May to 25 bearish by May 13. The technology-packed Nasdaq Composite isn't priced for hesitation, and traders know it.
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The Long Memory: Cooling Periods That Preceded New Highs
Here is where history does the heavy lifting. NVIDIA has lived through this pattern at least three times.
In early 2017, after a vicious crypto-related rally, NVIDIA stalled. The adjusted close drifted from 2.69 in January 2017 to 2.57 by April before the stock vaulted to 3.57 by June and kept compounding for years. The cooling proved to be a temporary pause inside a longer uptrend.
In 2019, trade-war jitters knocked the shares around for months. NVIDIA closed May 2019 at an adjusted 3.37. By December 2019 it had recovered to 5.86, setting the table for the 2020 to 2021 surge that minted a new generation of believers.
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Then came 2022. Fed hikes and an inventory glut dragged NVIDIA from an adjusted close of 24.44 in January to 12.12 by September. Investors who white-knuckled through that cooling period watched the stock become the defining trade of the decade. Each prior cooling phase was loud in the moment and quiet in the rearview.
The Fundamentals Keep Heating Up
The underlying numbers point to a still-expanding cycle. NVIDIA's Q4 fiscal 2026 revenue was $68.13 billion, up 73.2% year over year, with Data Center networking exploding 263%. Management guided Q1 to roughly $78.0 billion in revenue, excluding any China compute. Jensen Huang told the Street, "Computing demand is growing exponentially, the agentic AI inflection point has arrived."
AMD's Q1 2026 told the same story: $10.25 billion in revenue, Data Center up 57% year over year, with Q2 guidance of roughly $11.2 billion, implying 46% growth. Lisa Su called Data Center "the primary driver". Intel's foundry just doled out $5.42 billion in Q1 revenue, up 16% year over year, after being selected as host CPU for NVIDIA's DGX Rubin NVL8 systems. ASML lifted its FY2026 guide to $42.47B to $47.19B on a year-end backlog of $45.06 billion, with CEO Christophe Fouquet noting "Demand for chips is outpacing supply."
The Valuation Gut Check
NVIDIA trades at a trailing P/E of 45 and a forward P/E of 27, which sits well below typical bubble-top territory. AMD is the stretched one, sitting at a trailing P/E of 154 and a forward P/E of 65, with a PEG of 1.1 that anchors the valuation to growth. Qualcomm trades at a more pedestrian P/E near 40 with a $20 billion repurchase authorization behind it. You should consider trimming if you believe GPU rental prices signal a true demand reset. You should consider holding, or adding on weakness, if you believe hyperscaler capex commitments tell the truer story.
Those commitments are concrete. NVIDIA disclosed $95.2 billion in total supply commitments and $27.0 billion in multi-year cloud agreements. AMD's partnership with Meta spans up to 6 gigawatts of Instinct GPUs, and OpenAI has signed up for another 10 gigawatts of NVIDIA capacity. Long term, Wall Street still heads higher in the decades to come when the underlying demand curve looks like this.
The verdict: every cooling period in semis since 2016 has been a pause inside a longer uptrend. Today's anxiety, on B200 rental rates, on Intel's P/E debate, on QCOM's AI relevance, is the same anxiety that showed up in 2017, 2019, and 2022. Patient investors got paid each time. I'm keeping an eye on these stocks with that long memory firmly intact.
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Source: "AOL Money"
Source: Money
Published: May 13, 2026 at 09:18PM on Source: PRIME TIME
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