Chip stocks down since June, but still up 62% in 2026; software leads recent AI rally, says Jim Cramer.

Jim Cramer declared the semiconductor trade "broken" as software stocks have outperformed chips since June 2026, with software ETFs up about 22% and chip ETFs down 11% in that period. However, over the longer term since January 2026, chip stocks have surged nearly 62%, far outpacing software gains. The recent chip sell-off partly stems from a hedge fund collapse that forced selling of popular chip stocks, despite strong revenue and demand outlooks from companies like Micron and SanDisk. The debate hinges on whether Microsoft and other big tech firms maintain their high AI-related spending; if they do, chip demand should remain strong despite short-term volatility.

Semiconductor stocks like Micron and SanDisk show notable declines on Pluang, with Micron down 4.66% and SanDisk down 4.36% as of Oct 13, 2026 19:44 WIB. Meanwhile, the VanEck Semiconductor ETF (SMH) is also down 1.87%, reflecting some short-term pressure despite the strong longer-term gains noted in the article.