Arm Holdings Plc is facing a significant decline in its stock value as Exane BNP Paribas analyst David O’Connor made the decision to downgrade the company's stock rating from Outperform to Neutral, assigning a price target of $100. In the past five days, Arm shares have plummeted by almost 30%, largely influenced by the earnings reports of semiconductor giants like ASML Holdings N.V. and Taiwan Semiconductor Manufacturing Company Ltd., which have negatively impacted the sector.
The recent poor first-quarter results from ASML and the reduced market outlook from TSMC have fueled concerns within the semiconductor industry, leading to a downward spiral in stock prices. ASML's first-quarter results fell below expectations, while TSMC's outlook concerning consumer weakness has overshadowed its Q1 performance. The repercussions of these reports are reverberating across the market, with Nvidia Corporation and Super Micro Computer experiencing significant drops in their share prices, reflecting investor worries about the overall semiconductor sector's performance. Super Micro Computer, for example, announced its third-quarter earnings date without providing preliminary estimates, leading to speculation that its upcoming earnings report may not meet expectations. Investors are left to wonder about the company's financial performance, given this lack of insight into expected results.