Tech Test
US Stock Futures Steady; Micron Earnings Test AI and Semiconductor Market Outlook
Anonymous
Key Points
1
Germany will scrap plans to build Rheinmetall's F126 frigates and instead purchase 8 Meko A-200 frigates from TKMS, a move that sent Rheinmetall shares lower (about 14%) while TKMS benefits.
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Alphabet will replace Verizon in the Dow Jones Industrial Average, while Verizon shares slide in premarket trading as part of a broader index-constituent reshuffle.
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Micron is expected to report third-quarter earnings per share of about $20.57 and revenue around $35.56 billion, a key test for AI infrastructure spending and memory-chip demand.
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Cerebras Systems, the newly public AI chipmaker, fell about 14% premarket after forecasting annual sales that disappointed investors hoping for a larger AI data-center market share.
US stock futures steadied on Wednesday as traders caught their breath after a two-day semiconductor selloff that wiped over $1 trillion from the Nasdaq 100's value, according to Investing.com. All eyes turned to Micron Technology, set to report third-quarter earnings after the close — a report analysts called the definitive "litmus test" for AI infrastructure spending.
The stakes are high. Micron shares had surged roughly 830% over the past 12 months before the recent pullback, and Wall Street expects earnings of $20.57 per share on revenue of $35.56 billion, per TipRanks. A miss — or weak guidance — could deepen the "Chip-Wreck," as MEXC dubbed the recent selloff.
Micron's Earnings Face a "Perfect Beat" Demand
Micron's HBM chips — high-bandwidth memory required for AI accelerators — are completely sold out for all of 2026, according to tastylive. Needham analyst Quinn Bolton called the memory market "continued to strengthen over the past 90 days," backed by long-term supply deals that give Micron rare earnings visibility.
But bulls face a high bar. Cantor analysts warned that Micron now demands a "perfect beat and raise" to justify its valuation. The stock's implied move heading into earnings was 17%, reflecting a market priced for perfection — and highly sensitive to any disappointment on guidance.
Cerebras Drops 14% as AI Chip Margins Disappoint
Cerebras Systems, the AI chipmaker that went public in May 2026, fell roughly 14% in premarket trading after its first post-IPO earnings report. Revenue grew 94% year-over-year to $193.4 million, per Investing.com Australia. But investors focused on the bad news: gross margin guidance of just 38–41% for the full year.
CEO Andrew Feldman confirmed a $20 billion multi-year deal with OpenAI. He said OpenAI's GPT 5.4 is already running on Cerebras chips. Even so, the margin shortfall highlighted a growing problem — renting third-party manufacturing capacity makes it hard to match Nvidia's 70%+ gross margins, making long-term profitability a real question.
Alphabet Joins the Dow as Germany Ditches a $18B Frigate
Two major reshuffles landed on the same day. S&P Dow Jones Indices said Alphabet will replace Verizon in the Dow Jones Industrial Average on June 29, according to Quartz. Alphabet's market cap stands at $4.22 trillion; Verizon's is just $195 billion. The swap means all five of the largest US tech companies now sit inside the Dow.
Meanwhile in Europe, Germany scrapped the F126 frigate program — a project that ballooned from €10 billion to €18 billion — in favor of 8 smaller Meko A-200 frigates from TKMS, per Seeking Alpha. German Defense Minister Boris Pistorius cited "foreseeable cost increases" and contractor risks. Rheinmetall shares fell 14.4% on the news. TKMS surged 8.7%.
Tech Rally Stays Fragile With Yields and AI Spending in Focus
The S&P 500 and Nasdaq edged higher in choppy trading after two days of losses, per The Detroit News. Gains were narrow. Traders remain uneasy about whether large tech companies — called hyperscalers — can sustain the debt-backed AI spending that has driven chip demand. Higher bond yields continue to press on high-valuation tech stocks.
The broader market view, per The Edge Malaysia, is selective weakness rather than a full breakdown. Defensive sectors drew some interest. Volatility stayed contained. Micron's results and guidance — due at 4:00 p.m. ET — will set the tone for whether the AI trade resumes its climb or tips into something more painful.
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