A sharp selloff in U.S. semiconductor stocks erased about $1.3 trillion in market value on Friday, 5 June, as investors pulled back from high-flying artificial intelligence shares following a disappointing earnings report from Broadcom and renewed concerns over interest rates.

The benchmark PHLX Semiconductor Index plunged 10.3 percent, marking its steepest one-day decline since March 2020 during the height of the pandemic-driven market turmoil.

Leading AI chipmakers suffered heavy losses, with Nvidia falling about 6 percent and shedding more than $300 billion in market value. Micron Technology dropped 13 percent, while Advanced Micro Devices lost nearly 11 percent. Chip designer Marvell Technology tumbled 17 percent.

The selloff followed Broadcom’s quarterly earnings release, which showed demand for its custom AI chips failed to meet the market’s elevated expectations. Broadcom shares fell 7.9 percent on Friday, bringing their two-day decline to nearly 20 percent.

Investor sentiment was also weighed down by stronger-than-expected U.S. jobs data, which fueled concerns that interest rates could remain higher for longer. The broader S&P 500 index fell 2.6 percent.

Despite the sharp correction, semiconductor stocks remain among Wall Street’s strongest performers this year. The chip index is still up 73 percent year-to-date after hitting a record high earlier in the week.