Astera Labs (ALAB.US) shares plunge over 10% during Wednesday's session. This marks one of the stock’s largest single-day drops since the beginning of the year and continues a string of negative trading sessions. Since mid-September, the stock has been losing an average of 3% per day.
The main reason behind investors' concerns is the recently announced partnership between Intel and Nvidia, which involves the joint development of chips for data centers and PCs. Analysts worry that this project could significantly shift the balance of power in the semiconductor industry, potentially reducing demand for communication technologies provided by Astera Labs — particularly in the PCIe standard, which forms the foundation of the company’s products.
Investor anxiety is further exacerbated by the lack of detailed information about the partnership, fueling speculation and caution in the market.
Another factor adding pressure to the stock is Astera Labs’ elevated valuation. Over the past year, the company’s shares have surged by 300%, including a 180% increase in just the past six months. This suggests that much of the positive outlook has already been priced in. In such an environment, even minor uncertainty can trigger profit-taking.

Source: xStation5
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