Big Put Trades Hit SMH, Micron and Nvidia a Day After Chip Stocks Fell on OpenAI Revenue Report

Chip stocks took a hit on Thursday, Oct. 8. On Friday, Oct. 9, options traders piled into bearish positions.

By midday Friday, more than 180,000 put contracts had traded in the VanEck Semiconductor ETF (SMH), against about 50,000 calls, according to ThinkOrSwim and SpotGamma data. That put $46 million of premium on the put side and $26 million on calls. SpotGamma said about 129,000 of those puts appear to have been bought rather than sold.

Barchart data shows the put-to-call open interest ratio for SMH reached 1.95, the highest since the second week of August. The same ratio for the Invesco QQQ Trust climbed to 1.51.

The Nvidia and Micron trades

Just after the opening bell, someone bought 100,000 Nvidia puts at the $180 strike expiring Jan. 15, 2027, paying $21 million. It was the biggest options trade in the stock that day. If it is a speculative bet, Nvidia would need to fall roughly 22% by expiration for it to pay.

Micron drew the odder activity. Call volume ran 40% above average, yet SpotGamma data ties about $270 million of premium to likely put buying.

Part of that gap comes from a string of deep in-the-money puts expiring in June 2028. About 125 contracts at strikes between $2,250 and $2,500 traded closer to the ask, which suggests they were bought. About 50 trades at the $2,050 strike look like sales. Micron shares were around $1,030.

Taken at face value, that is a net $14.5 million bearish spread with a delta near -1. In plain terms, it behaves like a short position in the stock.

Traders buy deep in-the-money puts instead of shorting if borrowing the stock is too expensive, or if they want risk capped at the premium paid.

Reading the tape is not the same as knowing intent

The data does not say who is on the other side or why. Jason DeLorenzo, founder of the options analytics firm Volland, cautioned that spreads are hard to classify by midpoint analysis because "dealers are willing to take a haircut on one leg while getting a better premium with the other." Far out-of-the-money trades with low open interest add more noise.

A large put purchase can also be a hedge on a big long position. Nothing in the data distinguishes a bet from insurance.

What hit chips on Thursday

The Financial Times reported that OpenAI told investors its annualized revenue was running near $50 billion at the end of September, about $20 billion below the $70 billion it had projected. The metric multiplies a short period's revenue, such as a month or quarter, to estimate a full year.

OpenAI sits at the center of AI chip demand as both a major customer and a barometer. Chip stocks fell Thursday:

• Intel: down 5.3%
• Sandisk: down 4.9%
• Micron: down 4.8%
• Broadcom: down 4.3%
• AMD: down 3.9%
• Nvidia: down 2.9%

The State Street Technology Select Sector SPDR ETF (XLK) fell 1.8%, its biggest one-day drop since Sept. 14, according to FactSet.

Gil Luria, managing director at D.A. Davidson, said the report "caused undue concern in the market." He argued the $70 billion figure misrepresented the situation. According to the Financial Times, the gap stemmed from investors comparing OpenAI's annualized revenue with rival Anthropic's, which calculates the number differently. OpenAI had reportedly seen $40 billion annualized in August. Luria said OpenAI "is actually accelerating as it catches up with Anthropic at the enterprise market."

The fundamentals behind the run

The bearish positioning lands after a huge run. Micron's fiscal fourth-quarter revenue came in at $54.2 billion, up 379% from a year earlier. CEO Sanjay Mehrotra said the company "delivered record fiscal 2026 results, and we expect an even stronger 2027." The company also raised guidance.

Micron's stock has a 52-week range of $186.25 to $1,255. Its market cap is about $1.2 trillion.

Nvidia recently announced a $150 billion share buyback, a record. Its fiscal 2027 second-quarter sales were $96.2 billion. Investment writers Louis Navellier and Bohdan Kucheriavyi argue the buyback and earnings growth support much higher prices. Navellier sees Nvidia at $300 by year-end. Their valuation figures conflict: Navellier cites 24.6 times forecast fiscal 2028 earnings, while Kucheriavyi cites about 15 times.

The Motley Fool's analysis puts Micron at a forward P/E of about 7 against Nvidia's 23. It argues Micron could overtake Nvidia in market value by 2030. Both are forecasts and opinions, not results.

What comes next

U.S. markets are closed for the weekend, and the next regular session is Monday, Oct. 12. The Nvidia puts run to Jan. 15, 2027, and the Micron positions to June 2028, so neither trade resolves soon. Whether the buyers are betting on a drop or protecting large long positions is the open question, and the trade data cannot answer it.