Tech under the microscope amid AMD’s financial results and fears over a Democratic victory

(Il Sole 24 Ore Radiocor) - Tech shares under scrutiny in Europe, torn between fears that thethe Democrats’ ‘blue wave’ (which has taken the US Parliament by storm) might slow down the AI revolution and the prospects for ever-growing demand for tech products, as evidenced by AMD’s quarterly results. On the Milan Stock Exchange, shares are falling Stmicroelectronics, Technoprobe and Prysmian, which, after an uncertain start, has begun to trend downwards. Infineon Technologies is holding its ground in Frankfurt, whilst ASML is falling in Amsterdam. Some investors are factoring in the possibility that the Democrats may impose restrictions and limitations on the expansion of AI infrastructure, starting with electrification, the company’s core business.

In any case, amidst a sea of doubts and uncertainties, investors are entertaining the notion that the Democrats, despite having won control of both the House and the Senate in the mid-term elections, will not put the brakes on the AI revolution, thereby allowing Chinese companies to close the technological gap. Overnight, following the publication of the first election results, fears had instead spread that a Parliament entirely under Democratic control might put the brakes on the great AI revolution currently underway, thereby complicating the authorisation processes. So much so that the Chinese markets immediately sprang into action, whilst Japanese tech shares recorded substantial falls, as did the futures on the US Nasdaq. The words of President Donald Trump — who immediately acknowledged the Democrats’ victory, whilst blaming weak Republican candidates — and his assurances regarding cooperation with the opposition have calmed tempers, so much so that even Tokyo reduced its losses from 5 per cent to 1.4 per cent, and the Nasdaq futures moved from a sharp fall to a cautious rise.

Furthermore, the tech sector was also buoyed by the results of the US firm AMD, published after the close of trading on Wall Street, providing yet another confirmation that demand for AI is robust and exceeds the production capacity of the group, one of the leading suppliers of CPUs and GPUs. In detail, the company closed the third quarter with revenue of $13.4 billion (+45 per cent), driven by demand from data centres amounting to $8.6 billion (+97 per cent). Earnings per share stood at $2.09 (+8 per cent). All the figures beat market expectations, as did the guidance for the fourth quarter. The only downside was the weakness in demand for computers highlighted by the company, with the 2027 market expected to see a double-digit decline in volumes, hampered by rising memory prices (in line with the view expressed by Intel last week). In any case, the performance of this segment will be more than offset by demand for artificial intelligence accelerators.

Analysts at Equita pointed out that AMD is one of Technoprobe’s main customers: “We estimate it will account for 15–20 per cent of 2026 revenue,” they stated, emphasising their appreciation for the positive news announced by the US group. In particular, the prospects for very sustained growth indicated by AMD’s senior management and the need to further expand production capacity across the entire advanced semiconductor supply chain, including testing, one of the key stages, have led the SIM’s experts to reiterate their ‘Buy’ recommendation on Technoprobe with a target price of 44 euros.

As for STMicroelectronics, the company is also benefiting from the presentation of the strategic evolution of its STM32 portfolio, a unified microcontroller platform suitable for industrial, automotive and robotics applications.