Chip Stocks' Pullback Fuels Short Selling Frenzy
Written by Emily J. Thompson, Senior Investment Analyst
Updated: May 20 2026
0mins
Source: CNBC
- Rising Short Interest: Despite a recent pullback in semiconductor stocks, short interest in companies like Micron and Qualcomm remains near multiyear highs, indicating that investors see the current weakness as the start of a potential downturn in one of Wall Street's hottest trades.
- High Short Positions: Qualcomm's short interest has reached approximately $11.8 billion, marking the highest level in at least a decade, reflecting strong skepticism about the company's future performance, particularly following its failed acquisition of NXP Semiconductors.
- Market Reaction Risks: Bears are maintaining their positions despite the risk of a positive earnings report from Nvidia, which could reignite momentum in semiconductor shares, suggesting growing doubts about the sustainability of valuations in the sector.
- Industry Dynamics Shift: Chip stocks have been key drivers of market rallies, and despite recent declines, the PHLX Semiconductor Index is still up over 65% year-to-date, indicating that expectations for rising AI infrastructure spending continue to support the market.
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Analyst Views on QCOM
Wall Street analysts forecast QCOM stock price to fall
16 Analyst Rating
10 Buy
5 Hold
1 Sell
Moderate Buy
Current: 243.290
Low
165.00
Averages
197.14
High
225.00
Current: 243.290
Low
165.00
Averages
197.14
High
225.00
About QCOM
Qualcomm Incorporated is engaged in the development and commercialization of foundational technologies for the wireless industry, including third generation (3G), fourth generation (4G) and fifth generation (5G) wireless connectivity, and high-performance and low-power computing, including on-device artificial intelligence. Its segments include Qualcomm CDMA Technologies (QCT), Qualcomm Technology Licensing (QTL) and Qualcomm Strategic Initiatives. QCT develops and supplies integrated circuits and system software based on 3G/4G/5G and other technologies, including radio frequency front-end, digital cockpit and advanced driver assistance and automated driving, Internet of things including consumer electronic devices, industrial devices and edge networking products. QTL grants licenses or otherwise provides rights to use portions of its intellectual property portfolio that includes certain patent rights essential to and/or useful in the manufacture and sale of certain wireless products.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Profitability Analysis: Arm's net income margin stands at 21%, while Qualcomm boasts nearly 70%, indicating Qualcomm's strong profitability; however, its slowing revenue growth may impact long-term investment appeal.
- Market Transformation Strategy: Qualcomm is shifting focus from the handset market to sectors like automotive, IoT, and data centers, and if its AI strategy is successfully implemented, it could accelerate revenue growth and narrow the gap with Arm.
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See More
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- Market Dynamics to Watch: Next week, Merck will review its cancer portfolio, while Palo Alto Networks and Ulta are set to report earnings; Cramer anticipates that these companies may be influenced by AI-driven market changes, particularly in cybersecurity.
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