The chips that step grid power down to the sub-1-volt, thousand-amp rails an AI accelerator actually draws are having the best year in the history of the category. Monolithic Power Systems, which sells DC-to-DC conversion chips into servers, cars and industrial equipment, grew revenue 47.6% in the June quarter to a record $980.6m. Analog Devices, the broad-line analog chipmaker, reported its first $4bn quarter on 19 August. Both stocks then fell.

The fall is four days old. At the 17 August close all three of the companies below were still trading above where they stood a month earlier. Then, between 18 and 21 August, the six largest names in the group dropped an equal-weighted 9.9% — more than 100% of the decline recorded over the full 30 days. The trigger sits in the bond market, not the order book: on 18 August the 30-year Treasury yield topped 5.33%, a fresh 19-year high, on a widening federal deficit and sticky inflation, and the move was global — Japan's 10-year yield reached a 30-year high, Germany's 30-year bund its highest since 2011. A higher long rate mechanically shrinks the present value of earnings that arrive years out, which is precisely what these multiples are built on. Nvidia rose 1.4% over the same month. Nothing in the customer's shares says accelerator demand was repriced.

The socket incumbent

Monolithic Power is the name whose entire AI case rests on content per accelerator rising faster than hyperscalers can second-source it — a risk that cost it share in 2024. Its Q2 disclosure answers that directly. Enterprise data revenue was $380.6m, up 164.3% year over year and 38.8% of the company. Management raised its full-year enterprise-data growth forecast to 130% from 85%, said there is no single-customer concentration in that line, and put CPU share above 30%. Gross margin was 55.18%, inside a 26-basis-point band across five quarters. Operating income grew 84.4% on 47.6% revenue, widening operating margin by 620 basis points to 31%. Inventory was described as very low.

What it does not own is the next architecture uncontested. Nvidia's 2026 partner list for 800-volt direct-current power conversion runs to at least fifteen silicon suppliers, Analog Devices and Texas Instruments among them.

Analog Devices is a rival, not a bystander

It is tempting to file Analog Devices as an industrial-and-automotive cyclical. Its own quarter refuses. Communications revenue grew 84%, with data center now 80% of that segment and data-center power alone more than doubling. Management called intermediate-to-core conversion for 6,000-amp, sub-1-volt processors one of the fastest and largest growing analog opportunities. On 7 July it closed a $1.5bn all-cash purchase of Empower Semiconductor, which makes voltage regulators that sit under the accelerator and feed current vertically. Gross margin reached 67.3% and operating margin 40.1%, up 1,170 basis points. The shares went from $393.33 on 17 August to $370.24 on 20 August — down into the print and through it.

The selling was upside down

If this were AI power content being marked down, exposure would predict damage. It predicted the opposite. Over 30 days onsemi — silicon-carbide and power chips for electric vehicles and factories, with no meaningful data-hall business — fell 19.5%, and 32.2% over three months. Microchip Technology, a microcontroller maker still working through an automotive and industrial inventory correction, fell 10.7%. Texas Instruments, the largest analog supplier and the most catalog-driven, fell 10.4%. Monolithic Power fell 5.8% and Analog Devices 3.3%.

Vicor diverges

Vicor, the Andover, Massachusetts maker of modular power converters that pioneered 48-volt-to-point-of-load conversion and lost the Nvidia H100 socket to Monolithic Power, is the one name whose trend genuinely broke; its 50-day average crossed below its 200-day on 12 August. Headline revenue of $143.4m grew 1.6%, and gross margin fell 734 basis points to 58.0% — against a prior-year quarter containing a $45m patent settlement. Sequentially the picture inverts: revenue up 26.9%, margin up 280 basis points, advanced products up 45% to $94.2m, and one-year backlog up 26% to $379.7m. Cash rose $49.4m to $453.6m, so the cash-burn worry is misplaced; $15m of the quarter, though, was licensing income under a $60m agreement.

What the price now assumes

Monolithic Power trades at 48.0x forward earnings against 80.3x trailing, whose base is distorted by a one-off 2024 tax item; 35.8x trailing gross profit, down from 38.5x on 18 August. Analog Devices is cheapest on every lens — 29.1x forward, 19.9x trailing gross profit against 23.1x a week ago, a de-rating produced by the new quarter entering the base rather than by the price. Vicor's 62.9x trailing versus 58.4x forward is a spread of barely four points, against Monolithic Power's thirty-two: the market is not paying for this year's growth there but for 2027, when consensus has revenue rising 55.6%.

The setup

Where it stands — Two of the three have accelerating revenue, expanding margins and falling multiples at once; the drawdown began with a rate shock. Would confirm — Monolithic Power's enterprise data revenue growing sequentially again in the September quarter with gross margin held near 55%. Would invalidate — A disclosed second source at a major accelerator customer, or Monolithic Power inventory days rising as gross margin slips. Watch next — Monolithic Power's third-quarter report in late October; Vicor's second-fab site selection, promised within weeks of 21 July. Valuation — Monolithic Power 48.0x forward versus 80.3x trailing; Analog Devices 29.1x forward; Vicor 58.4x forward against 62.9x trailing.