Applied Materials (AMAT) tumbled 5.07% over the past 24 hours, deepening a multi-day selloff for the semiconductor equipment giant. The decline came during a session where the broader market saw gains, but the tech and chip sectors faced heavy headwinds, with the Philadelphia Semiconductor Index having fallen over 20% from its June high, crossing into bear market territory.

The primary catalyst behind the continued weakness is the disclosure that famed investor Michael Burry, known for his “Big Short” bet, has taken a short position in Applied Materials and the broader AI-driven semiconductor sector. Burry has predicted an approximately 30% correction in related chip stocks, and the ongoing digestion of this bearish stance has compounded market worries about the return on massive AI infrastructure spending. Additional selling pressure has come from growing concerns over rising competition from Chinese lithography equipment.

Despite the recent selloff, the company’s fundamentals remain a focus for the long term, with multiple institutions including HSBC, Citi, and UBS having recently raised price targets on Applied Materials to a range of $683–$705. The company is scheduled to report its fiscal third-quarter results on August 13, with consensus earnings per share expected at $3.36, which could serve as a potential catalyst for sentiment to shift.