(Bloomberg) -- Micron Technology Inc.’s post-results selloff sent a fresh reminder to global investors about the risks inherent in bets on artificial intelligence chipmakers.

Days after leading AI chipmaker Nvidia Corp. slumped by nearly half a trillion dollars, Micron shares fell about 8% in extended trading after the memory maker offered a forecast that fell short of the highest estimates.

Micron is among the companies that have gotten a lift from the mania for AI-related stocks, as its high-bandwidth memory is a candidate for use alongside Nvidia’s industry-leading chips for training large language models. Its shares had more than doubled in the year prior to its Wednesday report, but — even with an outlook roughly in line with the average of analyst estimates — the company was punished for not outperforming elevated expectations.

“The market is holding totally unrealistic expectations, as many names who are beating street estimates by a wide margin are still being sold down,” said Andrew Jackson, head of Japan equity strategy at Ortus Advisors Pte in Singapore. “But I think the street is very well aware of the fact that these US names are pretty overcooked. Too many paper hands chasing the fast easy money.”

The big jumps in market value appear vulnerable to rapid correction, as shown by Nvidia earlier this week when its shares entered correction territory on Monday before bouncing back. A global gauge tracking semiconductor shares fell about 5% since reaching an all-time high earlier this month. Taiwan Semiconductor Manufacturing Co., which makes Nvidia’s most valuable chips and is considered critical for AI, has slipped more than 2% since its June 19 high.

Micron’s news also triggered drops in South Korea’s two biggest companies, memory makers Samsung Electronics Co. and SK Hynix Inc., though they recouped their losses by the close on Thursday. For these businesses, whose traditional output of supplying memory for PCs, smartphones and more conventional data center use is still recovering from a slump last year, that means a greater degree of share price uncertainty.

The US chipmaker’s briefing fell short of what SK Hynix offered earlier, when it announced that its HBM production capacity is largely sold out through 2025, said Tom Kang, director at Counterpoint Research. Micron lacks the dominant position in AI memory that SK Hynix enjoys or Samsung’s lead in the broader memory industry, he added.

“This brings a reality check to the AI sector, which looks bubblish,” Kang said.

The relentless rally in US megacaps that are seen as benefiting from AI has pushed their shares to historically high valuations. Micron shares are priced at 4.5 times sales projected over the next 12 months, compared with an average of 2.2 times over the past 10 years.

--With assistance from Abhishek Vishnoi and Tan Hwee Ann.

(Updates with share performance)

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