China’s STAR50 index has lost roughly 40% from its July 2026 peak, wiping nearly $480 billion from the market value of its AI and semiconductor constituents in under four months, Reuters reports.
The decline has reached companies across China’s AI hardware supply chain, from humanoid robotics to memory chips and optical components.
- Unitree, a humanoid-robot maker, has seen its shares fall by half since its August listing.
- Memory-chip producer CXMT lost more than 25% in a single month.
- Optical-component supplier Zhongji Innolight is down about 60% from its summer high.
- Optical-component supplier Eoptolink is also down about 60% from its summer high.
Concerns over whether AI spending can generate returns quickly enough have weighed on sentiment, alongside US trade restrictions, tougher competition and stretched valuations. Even after the sell-off, STAR50 trades at about 100 times annual earnings, compared with roughly 30 times for the Nasdaq 100.
The correction does not by itself signal a collapse of the AI sector, but it could make investors more demanding about revenue and profitability. Future funding rounds and listings may slow, with companies lacking solid revenue potentially facing the greatest pressure as the market tests whether AI investment can justify its valuations.
