AI Stocks Selloff Deepens: Intel Falls 28.6% in Worst Day Since 1974 as Nasdaq Drops 2.9%

Wall Street suffered its worst day since June on Friday as the selloff in AI stocks deepened. The Nasdaq fell 2.9 percent and the S&P 500 fell 1.8 percent. Intel plunged 28.6 percent, its worst day since 1974.

The fall came after a week of weak tech earnings. Investors are now asking whether the huge spending on artificial intelligence will pay off soon enough to justify high share prices.

The mood is very different from just days ago, when Anthropic IPO: Claude Maker Files for Stock Market Listing as AI Shares Rally showed how hot AI shares had become.

Alphabet started the fall

Alphabet, Google’s parent company, fell more than 12 percent on Thursday. It was the company’s worst day on record. About $500 billion was wiped off its market value in a single day.

Investors worried about a slowdown in Google’s search advertising business. They were also worried that Alphabet burned through more cash in the summer than in the spring, because of heavy AI spending. Its shares fell another 1.4 percent on Friday, capping its worst month on record.

Intel and Amazon deepen it

Intel led Friday’s fall. Its shares dropped 28.6 percent after it gave a weak forecast for the final three months of the year. The company pointed to weakness in the personal-computer market, where higher memory chip costs are hurting demand.

Amazon fell 1.4 percent on Friday after its sales and profit missed expectations. Investors were more worried by its cash burn: the company burned through $42.4 billion of cash over the past 12 months, on a measure called free cash flow.

Chip stocks lead the losses

Chipmakers bore the brunt of Friday’s selling. Nvidia fell 4.2 percent, and a closely watched index of chipmakers sank 7.2 percent. AMD also fell sharply.

The Nasdaq is now down 7.8 percent from its record high earlier in October. It suffered its worst monthly decline since March 2025.

The question investors are asking

The core question is simple: will massive AI spending turn into profit? Tech giants are spending hundreds of billions of dollars on data centres and chips. So far, the returns have not kept pace with the spending.

Friday was the final trading day of a bruising month for AI stocks. Two big earnings reports are still to come: Apple next week, and Nvidia in mid-November. Both could move the market again.