Chip funds rose 2.5% as software ETFs fell 4.5%

Nvidia, the AI-chip designer, accounted for more than the entire weekly gain in the $121 billion Technology Select Sector SPDR ETF AXLK. The software fund that Salesforce lifted a week ago was cut instead by its two largest holdings. Through Friday, September 4, that is the split inside tech: hardware that feeds the AI buildout was bid, and software that had already been paid for last week's enthusiasm was not.

AXLK rose 0.86%. Nvidia is 14.9% of the fund and advanced 5.9%, adding 0.88 percentage points. The Invesco S&P 500 Equal Weight Technology ETF BRSPT fell 0.94%. Cap-weighted tech worked this week because a handful of chip names worked.

Nvidia, memory, and Broadcom's bill

The VanEck Semiconductor ETF ASMH rose 2.5%. Nvidia is 23.8% of that fund and contributed 1.4 percentage points, more than half the week's move.

Micron, the memory-chip maker, did not report. It still rose 9.0%, including 6.1% on Friday. Sandisk, the NAND-flash producer, jumped 17%, 11.9% of it on Friday. Intel rose 7.1%. August payrolls of 162,000, with unemployment unchanged at 4.1%, arrived Friday morning. ASMH rose 2.6% that session and the iShares Semiconductor ETF ASOXX 3.5%. A hotter labor print did not interrupt the memory bid.

ASOXX, which caps its largest names, rose 2.2% for the week. Nvidia is 9.5% of that fund against 23.8% in ASMH, and Micron, at 8.9%, contributed more to ASOXX this week than Nvidia did. Credo Technology, which sells connectivity chips used in AI data centers, was a separate hit. It reported fiscal first-quarter revenue of $479 million against $473 million estimated and adjusted earnings of $1.20 a share against $1.17. The shares still fell 20% on Wednesday and 27% for the week, wiping 0.52 percentage points from ASOXX, almost as much as Nvidia put in.

Broadcom, the custom AI-accelerator and networking supplier, supplied the week's real earnings test. On Wednesday it reported fiscal third-quarter revenue of $29.6 billion, up 86% from a year earlier, and non-GAAP earnings of $3.32 a share against $3.22 estimated. AI semiconductor revenue was $16.7 billion, up 221% year over year and 54% from the prior quarter. Chief executive Hock Tan said demand for custom AI accelerators and networking "continues to be very strong" and pointed to $21.7 billion of AI semiconductor revenue in the current quarter, up 236% from a year ago. Fourth-quarter revenue was guided to about $34.8 billion, up 93%, short of the $35.03 billion analysts expected.

The shares fell 2.7% on Thursday and 3.0% for the week. They sit 28% below a 52-week high of $495 and are up only 3.8% this year. That is the bill: a guidance miss against a $35.03 billion bar, and a stock still 28% under its high even after AI silicon revenue more than tripled.

Nvidia does not have that problem. It closed Friday at $230.36, 2.6% under its 52-week high, and on Thursday agreed to buy Hugging Face, the open-source AI model platform, for $12.93 billion. The iShares Future AI & Tech ETF BARTY, a 49-name fund with Nvidia the largest holding at 4.9%, rose 2.1% and is up 58% year to date. The Global X Artificial Intelligence & Technology ETF BAIQ, 88 names with Palantir the largest at 4.0%, managed 0.16%. Palantir subtracted 0.26 percentage points.

Cadence Design Systems and Synopsys, the chip-design software pair, fell 14% and 11%. Neither company reported this week.

Palo Alto's beat, Adobe's succession, Snowflake's fade

The iShares Expanded Tech-Software Sector ETF CIGV fell 4.5%, giving back the week Salesforce, the customer-software company, had just delivered. Salesforce itself added 0.09 percentage points this week. Palantir, the fund's largest holding at 10.3%, and Palo Alto Networks, at 9.6%, subtracted 1.65 percentage points together.

Palo Alto Networks, the cybersecurity platform, reported fiscal fourth-quarter results after Tuesday's close: adjusted earnings of $1.02 a share against $0.98 estimated, and revenue of $3.41 billion against $3.35 billion. The shares fell 9.3% on Wednesday and 10.3% for the week. They are still up 81% this year. The iShares Cybersecurity and Tech ETF BIHAK fell 3.6% with it. The First Trust Cloud Computing ETF BSKYY dropped 2.2%.

Adobe fell 6.7% on Friday after naming Anil Chakravarthy as its next chief executive, succeeding Shantanu Narayen, who becomes executive chair on December 1. The shares are down 24% this year and 8.6% on the week.

Snowflake, the cloud data platform, was the software print that actually moved. After Wednesday's close it reported fiscal second-quarter revenue of $1.55 billion against $1.48 billion estimated and adjusted earnings of $0.62 a share against $0.45. Product revenue was $1.49 billion, up 37% from a year earlier. Remaining performance obligations were $9.00 billion. Full-year product revenue guidance rose to $6.07 billion, or 36% growth, from $5.84 billion.

What Friday's prices assume

Friday's closes treat custom AI silicon and high-bandwidth memory as scarce, and most application software as already paid up. Broadcom can print $16.7 billion of AI chips and guide the next quarter to $21.7 billion and still finish the week lower, 28% under its high, after missing a $35.03 billion revenue consensus with a $34.8 billion guide. Nvidia can spend $12.93 billion on the model hub the rest of the industry uses and finish near its own high. Micron can add 9% without reporting. Palo Alto Networks can beat and drop 10%.

ASMH is up 57% this year and still 16% below its 52-week high. ASOXX is up 73% and 21% below its high. CIGV is down 1.0% in 2026. Hardware was bid this week; software had to clear more than a beat.