What Happened?

A number of stocks fell in the afternoon session after the chief executives of Anthropic, OpenAI, and SpaceX publicly united to call for a deliberate slowdown in the development of frontier AI models over escalating safety risks. According to CNBC, the sell-off was triggered by an essay published over the weekend by Anthropic CEO Dario Amodei, who urged a more cautious approach to frontier model advancement and called for independent safety monitoring. In a rare show of unity among competitors, the proposal was quickly endorsed by OpenAI CEO Sam Altman and SpaceX CEO Elon Musk. The unexpected warnings sparked immediate concern across the market regarding the sustainability of the heavy capital spending that has driven tech valuations higher. In response to the developments, Citigroup shifted to a neutral stance on broader equity risk, cautioning investors that any institutional pause or deceleration in AI deployments could temper corporate earnings growth and pressure chipmakers reliant on rapid, unchecked infrastructure expansion.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Processors and Graphics Chips company Lattice Semiconductor (NASDAQ: LSCC) fell 9.8%. Is now the time to buy Lattice Semiconductor? Access our full analysis report here, it’s free.
• Semiconductor Manufacturing company Amkor (NASDAQ: AMKR) fell 7.2%. Is now the time to buy Amkor? Access our full analysis report here, it’s free.
• Analog Semiconductors company Himax (NASDAQ: HIMX) fell 6.9%. Is now the time to buy Himax? Access our full analysis report here, it’s free.
• Semiconductor Manufacturing company Teradyne (NASDAQ: TER) fell 11.7%. Is now the time to buy Teradyne? Access our full analysis report here, it’s free.
• Semiconductor Manufacturing company Entegris (NASDAQ: ENTG) fell 7.1%. Is now the time to buy Entegris? Access our full analysis report here, it’s free.

Zooming In On Teradyne (TER)

Teradyne’s shares are extremely volatile and have had 61 moves greater than 5% over the last year. But moves this big are rare even for Teradyne and indicate this news significantly impacted the market’s perception of the business.

The previous big move we wrote about was 6 days ago when the stock gained 4.6% on the news that Qualcomm announced a multi-generational product collaboration with Amazon Web Services to develop custom AI data center infrastructure, while ASML, TSMC, and Intel achieved key milestones in next-generation chip manufacturing. According to a Qualcomm press release, the chipmaker announced a multi-generational product collaboration with Amazon Web Services (AWS) to develop custom AI data center infrastructure. The strategic partnership focuses on co-designing successive generations of custom AI chips specifically targeted at high-performance inference and data center workloads. By leveraging Qualcomm's custom silicon expertise, the collaboration aims to strengthen AWS's internal hardware ecosystem, significantly reduce operating costs, and improve energy efficiency, positioning the cloud provider to better compete against traditional GPU-based infrastructure. Simultaneously, major advancements were announced in next-generation chip manufacturing. At the SPIE Photomask conference, ASML and TSMC announced a joint industry initiative to transition from traditional 6-inch photomasks to larger 12-inch formats, ASML said in a press release. Photomasks are the master plates used to print circuit designs onto silicon. Currently, the advanced optics in next-generation "High NA EUV" systems shrink the print area of standard 6-inch masks, forcing chipmakers to use a complex, expensive "stitching" technique to manufacture larger artificial intelligence processors. The transition to 12-inch masks will expand the print field, significantly reducing manufacturing costs and boosting fab output, with the partners targeting a pilot line by 2031 and full production by 2033, the release said. Additionally, Intel Foundry and ASML announced a major milestone, confirming that Intel has processed over one million wafers across testing and volume production on its Intel 18A node using High NA EUV equipment, according to an ASML press release. Together, these coordinated advancements across custom cloud silicon and advanced lithography boosted investor confidence in the commercial readiness of sub-2-nanometer chip designs and next-generation AI infrastructure.

Teradyne is up 61.7% since the beginning of the year, but at $335.68 per share, it is still trading 30.6% below its 52-week high of $483.84 from June 2026. Investors who bought $1,000 worth of Teradyne’s shares 5 years ago would now be looking at an investment worth $2,744.

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