Story
U.S. Stock Futures Fall as Weak Netflix Guidance, Chip Sell-off Hit Tech
Summary
Futures for major U.S. indexes declined after Netflix issued a disappointing revenue forecast, compounding pressure from a continued sell-off in semiconductor stocks.
U.S. stock index futures fell in evening trading on Thursday, dragged down by broad weakness in the technology sector after streaming giant Netflix Inc. provided a weaker-than-expected forecast and semiconductor stocks extended their recent declines.
The move lower followed a negative session on Wall Street, where hawkish commentary from a Federal Reserve official and ongoing geopolitical tensions added to investor concerns.
Tech Sector Under Pressure
Netflix (NASDAQ:NFLX) shares slid nearly 9% in after-hours trading. The drop came after the company issued revenue and profit guidance for the current quarter that fell short of Wall Street estimates, overshadowing its otherwise strong second-quarter earnings report.
The weak outlook from Netflix added to the pressure on technology shares, which have been retreating amid growing questions over high valuations driven by artificial intelligence enthusiasm. According to a report cited by Investing.com, Alphabet (NASDAQ:GOOGL) also contributed to the negative sentiment, falling 4.4% after news that it delayed the release of its flagship Gemini 3.5 Pro AI model.
Chip Stocks Extend Losses
AdThe semiconductor industry remained a significant source of weakness. The Philadelphia Semiconductor Index fell 4.3% during Thursday's session, with major chipmakers losing ground despite some positive corporate news.
TSMC (NYSE:TSM), the world's largest contract chipmaker, fell 2.3% even after reporting stellar second-quarter earnings and raising its revenue guidance on strong AI-related demand. However, the company also forecast significantly higher capital spending for the year, fueling concerns about the costs required to sustain growth in the AI space. Other major chip stocks also declined, with Intel Corporation (NASDAQ:INTC) falling 5.8% and NVIDIA Corporation (NASDAQ:NVDA) shedding 2.4%.
Broader Market Headwinds
Thursday's regular trading session saw all three major U.S. indexes close lower, with the tech-heavy NASDAQ Composite leading the decline with a 1.5% loss. The S&P 500 shed 0.5%, and the Dow Jones Industrial Average lost 0.2%.
Market sentiment was also dampened by comments from Dallas Fed President Lorie Logan, who called for “modestly” higher interest rates to manage inflation risks. Investors are also monitoring heightened U.S.-Iran tensions, which have pushed oil prices higher and raised concerns about potential energy-driven inflation.
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