AI Stocks Plunge as Democrats Win US Midterms

Key Takeaways

• Democrats won US midterm elections, causing AI and data center stocks to slip — Nasdaq 100 fell 4.5 percent putting $1.8 trillion at risk, and the Philadelphia Semiconductor Index dropped 8.4 percent.
• UBS analysts estimate 30 percent of expected US data center capacity additions in 2028 could face construction pauses due to political scrutiny.
• 41 local data center measures appeared on ballots across 10 states, with 28 proposing restrictions; at least 45 projects worth $68 billion were blocked or delayed in Q2 2026.
• Meta is investing $145 billion in AI infrastructure but reported negative free cash flow of $2.12 billion in Q3 2026 — its first quarterly deficit since 2012 — and is considering overseas expansion.
• TSMC posted its third straight earnings beat with Q3 revenue of $46.72 billion, up 41.2 percent, and guided Q4 revenue to $52.3–$54.3 billion implying 58 percent growth.
• Onsemi's AI data center revenue surged 175 percent year over year to $180 million, with volume shipments started to platforms including Google, and a 2030 target raised to over $3 billion.
• Rambus dominates DDR5 registered clock driver market for AI servers, reporting record Q3 product revenue of $114.31 million.
• AWS posted its fastest growth in nearly five years with revenue of $201.94 billion and operating income up 61.15 percent, though EPS of $1.89 missed expectations.
• Over 84,000 software flaws were publicly reported in 2026, nearly double the 45,000 found in 2025, with Anthropic's Claude Mythos Preview helping find over 10,000 serious flaws in its first month.
• Qualcomm targets a $7 billion data center annualized run rate by end of fiscal 2027 and a $15 billion target for fiscal 2029.

Rambus leads AI server memory chip market

Rambus dominates the market for DDR5 registered clock drivers used in every AI server. The company reported record third-quarter product revenue of $114.31 million and beat earnings estimates. Its stock has fallen 19.88% over the past month, trading at $85.54. The 24/7 Wall St. price target is $128.10 with a BUY rating at 90% confidence.

Onsemi AI data center sales surge 175%

Onsemi reported AI data center revenue of $180 million, up 175% year over year. The company expects about $620 million from AI data centers in 2026 and raised its 2030 target to over $3 billion. Onsemi also started volume shipments to platforms including Google. Third-quarter revenue was $1.7223 billion, beating estimates, and shares traded at $73.

Onsemi AI revenue growth raises stock questions

Onsemi's AI data center sales grew 175% year over year, reaching $180 million in the third quarter. The stock trades 47.65% below its 52-week high of $134.92 despite a 34.81% gain year to date. Management expects AI revenue to double again in 2027. The 24/7 Wall St. price target is $87.90 with a BUY rating at 90% confidence.

TSMC AI demand tests profit growth

TSMC posted its third straight earnings beat with third-quarter revenue of $46.72 billion, up 41.2%. The company guided fourth-quarter revenue to $52.3 billion to $54.3 billion, implying 58% growth at the midpoint. Shares fell 10.97% over the past month but are up 34.67% year to date. The 24/7 Wall St. price target is $516.16 with a BUY rating at 90% confidence.

Micron seen as top AI memory stock

Micron Technology rates a BUY with a 24/7 Wall St. price target of $995.75 and 90% confidence. Over 75% of fiscal 2027 shipments are already committed to long-term customers. Fiscal Q4 revenue reached $54.23 billion, up 379.3% year over year, beating estimates. The bull case reaches $1,348.70 driven by HBM4 high-volume production.

Amazon AWS growth hits five year high but stock drops after earnings

Amazon's cloud division AWS posted its fastest growth in nearly five years with revenue of $201.94 billion. Operating income rose 61.15 percent to $28.08 billion. However shares fell after earnings because EPS of $1.89 missed expectations. Amazon plans to start selling chips to outside customers in late 2027. The company also faces rising capital spending risks in 2027.

AI and data center stocks fall after Democratic midterm victory

AI and data center stocks slipped after Democrats won a sweeping US midterm election victory. CoreWeave and Nebius each fell about 4 percent. Investors worry Democratic control of Congress could bring tougher scrutiny of data center expansion. UBS analysts estimate about 30 percent of expected US data center capacity additions in 2028 could be at risk. Hyperscalers like Amazon Alphabet and Meta rose nearly 1 percent while Qualcomm plunged 9 percent.

Nasdaq faces $1.8 trillion selloff risk amid AI regulatory uncertainty

The Nasdaq 100 fell 4.5 percent putting about $1.8 trillion in market value at risk after Democrats won midterm elections. The Philadelphia Semiconductor Index dropped 8.4 percent. Chipmakers Nvidia and Broadcom were among the biggest losers. UBS analysts estimated 30 percent of expected US data center capacity additions in 2028 could face construction pauses. Qualcomm plunged 12 percent after missing smartphone chip sales estimates.

US voters back data center restrictions amid AI expansion backlash

US voters backed restrictions on data center development in midterm elections. A total of 41 local measures concerning data centers appeared on ballots across 10 states. Of those 28 proposed restrictions while 13 supported new projects. In Alhambra California 82 percent of voters backed a ban on data center construction. At least 45 data center projects worth $68 billion were blocked or delayed in Q2 2026 due to local opposition.

Meta considers overseas expansion for $145 billion AI push

Meta is considering overseas data center expansion due to political opposition in the US. The company is investing $145 billion in AI infrastructure including projects in Louisiana Ohio and Texas. Meta reported negative free cash flow of $2.12 billion in Q3 2026 its first quarterly deficit since 2012. Dina Powell McCormick said the company is exploring opportunities in other countries. New elected governors in Ohio and Texas have signaled support for tighter data center restrictions.

Yuanta Securities expands AI training for employees

Yuanta Securities is expanding its internal training program to build employee skills in AI. The company is teaching vibe coding and AI agents through its AIbility Academy STEP-UP program. The training takes place at the company headquarters in Yeouido, Anchor One. This initiative aims to strengthen the workforce's ability to use artificial intelligence effectively.

Path Robotics hires for 50 Columbus jobs in physical AI

Path Robotics is hiring for more than 50 positions in Columbus across AI, robotics, engineering, sales, and operations. The company now has over 300 employees and develops AI models that let robots perform complex manufacturing tasks like welding. Co-founder Andy Lonsberry says Ohio is in the company's DNA and believes Ohio is the capital of physical AI. The company chose Columbus because it combines research talent from Ohio State University with experienced manufacturing workers.

AI finds software flaws faster than they can be fixed

AI tools are discovering software security flaws faster than ever before, creating a challenge for the world to fix them all. Over 84,000 software flaws were publicly reported in 2026, nearly double the 45,000 found in 2025. Microsoft fixed more flaws in a single month than in any previous full year, and Google Chrome released nearly 14 times as many security fixes in 2026 compared to 2025. Anthropic's Claude Mythos Preview model helped partner organizations find over 10,000 serious flaws in its first month. Experts warn that while AI helps defenders, it could also help attackers find weaknesses.

IREN AI Cloud revenue reaches $228M with $4B ARR contracted

IREN reported that its AI Cloud drove revenue up 66% quarter over quarter to $228 million. The company's AI Cloud segment contributed $200 million of that revenue. More than $4 billion of annual recurring revenue remained contracted and funded. The net loss narrowed to $263 million. Operational timing for the contracted ARR is targeted for January 2027, potentially extending to February.

PHP2Shell exploit shows AI helps experts not replace them

The PHP2Shell exploit used AI to find a long-ignored memory error and turn it into a working remote exploit. Four PHP Foundation engineers spent two months building a patch after the vulnerability was disclosed. The flaws, mapped to CVE-2026-109618 and CVE-2026-109619, were each scored CVSS 9.2 for unauthenticated remote code execution. Experts say AI moved a bug class humans usually ignored into a working exploit quickly, suggesting similar old reports could now be triaged faster. However, open source maintenance still carries about 40 years of technical debt according to AI security research lead Matt Suiche.

OpenAI publisher deals do not guarantee ChatGPT visibility

OpenAI has signed deals with over 20 publishers covering 85 domains, but a license does not guarantee visibility in ChatGPT. Ahrefs found that 10 of those 85 domains rank among ChatGPT's 50 most-cited sites. Lifestyle and product review sites like Vogue and Car and Driver get far more citations than hard news partners like The Washington Post. Partner sites made up 7.5% of citations among ChatGPT's top 200 domains in March 2026, rising to 15.8% in July before easing to 12.5% in September.

Qualcomm targets $7B data center run rate by fiscal 2027

Qualcomm said on November 4, 2026 that it expects Data Center revenues of $650 million or more in Q1 FY27. The company plans to grow each quarter and reach a $7 billion annualized run rate by the end of fiscal 2027. It also set a $15 billion target for fiscal 2029. The 10-K added a risk factor warning that its growing focus on AI may not bring expected benefits.

Sources

• This Little-Known Semiconductor Stock Has a Big AI Connection
• Onsemi's AI Data Center Sales Reportedly Grew 175%. Is That the Chip Stock's New Story?
• Onsemi’s AI Data Center Sales Reportedly Grew 175%. Is That the Chip Stock’s New Story?
• TSMC's AI Opportunity Is Expanding. Here's the Question That Matters for Its Stock Price
• Prediction: This Could Be the Best AI Stock You’re Not Talking About
• Amazon Is Winning the AI Race in the Cloud. Here's What Investors Need to Watch Next.
• AI, data-center stocks slip as Democratic sweep clouds expansion plans
• Nasdaq faces $1.8 trillion selloff risk as AI stocks grapple with regulatory uncertainty after midterms
• US voters back data center restrictions amid backlash over artificial intelligence expansion
• Meta eyes global expansion for its $145 billion AI push after Democrat wins: Is America losing the data centre race?
• Yuanta Securities to boost employees’ AI capabilities...expands training in vibe coding and AI agents
• Path Robotics is hiring for more than 50 Columbus roles in physical AI
• AI Is Finding Software Flaws Faster Than The World Can Fix Them
• IREN: AI Cloud drove revenue to $228M as more than $4B of ARR remained contracted and funded
• PHP2Shell Shows AI Helps Experts, Not Replaces Them
• OpenAI's publishers don't equal ChatGPT reach
• Qualcomm Guides Data Center Sales to $7B Pace, 2.7x Its Q1