Cathie Wood Warns Chinese Chip Expansion Increases Market Volatility

Cathie Wood, founder and CEO of ARK Investment Management, warned investors in Hong Kong that China's expansion of chip manufacturing capacity is increasing volatility in the memory sector. She argued that the entry of state-backed Chinese DRAM producers, specifically CXMT Corp., will amplify price swings and deepen the industry's boom-and-bust cycles.

Wood noted that while high-bandwidth memory is currently scarce, incremental supply from China could destabilize prices. This volatility has already affected market leaders including Micron Technology in the United States and Samsung Electronics and SK Hynix in South Korea. Wood expressed broader skepticism toward China's technology sector, citing a prolonged property downturn and unresolved deflationary pressures.

During her remarks, Wood disagreed with Broadcom CEO Hock Tan's assessment that AI investment has become speculative. She maintained that the technology will instead drive transformative productivity gains.