U.S. equities experienced a broad sell-off on Friday, dragging major market indexes down significantly as disappointing quarterly financial reports from prominent technology corporations rekindled investor anxiety regarding soaring capital expenditures on artificial intelligence.
The Nasdaq Composite led the market downturn, plunging 2.8% to mark its worst single-session performance since June. Meanwhile, the Dow Jones Industrial Average fell 579 points, representing a 1.1% decrease, and the broader S&P 500 dropped 1.8%.
The downward market momentum followed earnings releases from Amazon, Intel, and Google parent Alphabet that stoked investor apprehension about the massive financial commitments required to build out AI infrastructure. Amazon shares tumbled nearly 6% after the e-commerce and cloud giant delivered third-quarter financial results that missed consensus Wall Street expectations. The company also posted a negative free cash flow of $42.4 billion while reaffirming its projection for capital expenditures to reach $220 billion by 2026.
Semiconductor stocks faced particularly severe pressure following warnings from industry leaders. Intel shares declined more than 5% after the chip manufacturer cautioned investors about decelerating demand within the personal computer market. The firm reported a 5% revenue contraction in its client computing and physical AI division.
Other major players in the semiconductor sector shared in the losses. Advanced Micro Devices dropped 11%, Broadcom fell 5%, and artificial intelligence hardware leader Nvidia lost 4%.
Alphabet shares faced sustained downward pressure, declining 1.2% following its earnings report released Thursday and continuing to slide through Friday’s trading session. The technology conglomerate has encountered mounting scrutiny from analysts and shareholders alike regarding the scope and pace of its investments in artificial intelligence infrastructure.
