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As chip stocks swing violently, fueling debate over whether the AI market has hit its limits, AI industry executives dismissed the pessimism, insisting that "AI demand remains strong."
On the 12th (local time), Pat Gelsinger, a general partner at Playground Global and former Intel CEO, told U.S. broadcaster CNBC, "I think AI demand is virtually infinite."
Gelsinger argued that the only constraint on AI demand is energy. "The only constraint is power supply," he said, adding, "As intelligence improves, the economic value created is nearly infinite, and there is enormous room to use AI across every industry."
Mark Borodizky, chief revenue officer (CRO) of Nebius, also rejected claims of an AI demand slowdown. Amsterdam-based Nebius builds data centers using Nvidia graphics processing units (GPUs) and leases them to related startups.
"The demand we are currently experiencing is exceptionally strong," Borodizky said. "Demand far exceeds what we are able to supply, and this situation has persisted for a long time."
Recently, chip stocks have seen intensified market volatility in the U.S. and South Korean markets. On the 13th, the KOSPI index fell 8%, triggering a "circuit breaker" in the KOSPI market that afternoon — the seventh this year. Declines were especially steep among top market-cap names SK hynix and Samsung Electronics. SK hynix was trading at 1.907 million won, down 12.52%, and Samsung Electronics stood at 262,500 won, down 7.72%.
According to financial analysis platform The Kobeissi Letter, over a 60-day period since early May the benchmark Philadelphia Semiconductor Index (SOX) posted at least a 5% single-day gain on nine occasions, the most since January 2009. Meanwhile, according to Goldman Sachs, U.S. hedge funds had sold technology hardware-related stocks for four consecutive weeks as of the 6th, Reuters reported. Markets have swung between buying and selling extremes over short periods.
Such volatility fundamentally stems from doubts that AI demand has reached its limits. Concerns over oversupply arose after Meta, previously a consumer of AI infrastructure, recently said it would sell surplus computing capacity externally. Analysts note that Samsung Electronics' share price fell despite strong earnings, prompting the view that further upside is limited.
In response, Cerebras CEO Andrew Feldman characterized the cases of Meta and xAI selling computing capacity as special situations, explaining, "For the industry as a whole, demand for AI computation far exceeds supply capacity. Data centers are in short supply, and many key components needed for AI computation are also in short supply."
Park Sung-hyun, CEO of Rebellions, echoed this view, saying, "Momentum in AI infrastructure investment remains very strong," and, "I do not think the Meta and xAI cases are a sign that hyperscalers are over-investing in AI infrastructure."
Michael Hurlston, CEO of Lumentum, which supplies optical communications components for data centers, also said, "Our current products are effectively all sold out for the next five years," adding, "We are expanding production capacity as much as possible to meet the demand expected to continue over the next five years."
