SOX Index Soars Toward Bull Market, But Analysts Warn: Massive AI Backlog ≠ Revenue in Hand

U.S. semiconductor stocks rallied across the board on Wednesday (12th), with the Philadelphia Semiconductor Index closing at 12,399.38 points—just 1.1% short of the 12,536.99-point threshold that marks a 20% rebound from recent lows, commonly known as a 'technical bull market.'

The surge was directly triggered by after-hours earnings reports from three mid-to-downstream AI infrastructure companies on Tuesday (11th): CoreWeave, Super Micro Computer, and Lumentum. CoreWeave raised its full-year capital expenditure guidance from $31–35 billion to $35–39 billion, with its backlog reaching $104 billion, and added over $25 billion in new customer commitments by early July. Super Micro reaffirmed its outlook for new orders exceeding $60 billion in the June quarter. Lumentum saw its quarterly revenue double, driven by strong demand for 1.6T optical modules and AI data center optical interconnects.

However, Dan Kemp, founder of Portfolio Thinking, argues that backlog represents 'contracted but unconfirmed revenue,' which can be partially canceled or delayed. He suggests treating it as a probability distribution rather than guaranteed income.

Using CoreWeave as an example, Kemp notes the company reported $640 million in net interest expenses in Q2, compared to only $128 million in adjusted operating profit, with total debt amounting to $35 billion. 'We haven’t yet seen sufficient consumer and enterprise spending to support this scale of capital commitment,' he said.

Brian Mulberry, chief market strategist at Zacks Investment Management, offers a more positive view, stating that AI-related transactions are 'becoming broader, not just bigger.' CoreWeave validates GPU demand, while Lumentum confirms the need for supporting optical networks. He believes Nvidia, Broadcom, and Coherent have the strongest fundamentals, but emphasizes that not all chipmakers will benefit equally. The market focus has shifted from 'price momentum' to whether 'growth is accelerating.'

Although the SOX index is nearly at bull market territory, the key question has evolved from 'Does AI demand exist?' to 'Can the pace of demand fulfillment meet the expectations priced into valuations?' A $104 billion backlog is impressive, but the gap between $640 million in interest expenses and $128 million in operating profit reminds the market that four major hurdles—power, liquid cooling, delivery timelines, and interest rates—stand between orders and actual profits.