US stocks fell sharply on Friday as weak results from major technology firms raised fresh doubts about the huge sums being spent on artificial intelligence. Intel led the losses after its latest results disappointed investors. Amazon also faced pressure, while chipmakers suffered broad declines. The sell-off hit the Nasdaq hardest and ended a strong run for several major technology shares.
The Nasdaq Composite dropped 2.86% to close at 25,437. This was its largest one-day percentage fall since June 5. The index also ended the session 7.8% below its record high on October 6. The S&P 500 fell 1.82% to 7,580.07, while the Dow Jones Industrial Average lost 1.09% to finish at 51,770.31.
The sharp fall showed how quickly market mood can change when investors question the value of expensive technology plans. Many firms have pledged billions of dollars to build data centers, buy advanced chips and expand AI services. Investors have supported much of this spending because they expect strong growth in future revenue. Yet recent results have raised concerns about whether those investments will deliver enough profit.
Intel was among the worst performers of the day. Its shares plunged 28.6% after its results and outlook failed to meet market hopes. The steep decline added to concerns about the company’s ability to compete in a market where demand for advanced computing products remains high.
Amazon shares also came under pressure after its latest results. The stock later recovered some of its losses, but the report still added to doubts about the costs tied to AI development and cloud services. Investors are watching closely to see whether major technology companies can turn their growing AI budgets into stronger earnings.
The pressure spread across the semiconductor sector. Nvidia shares fell 4.2%, while Advanced Micro Devices dropped 10.9%. The wider semiconductor index slid 7.2% on Friday and was down more than 15% for October. These losses reflected concerns about the pace of chip demand, future profit growth and the scale of investment needed to support AI systems.
Other technology-related firms also saw sharp falls. Dell Technologies lost 10.8%, while HP declined 9.6%. Both companies have links to the market for computers and data center equipment. Their losses showed that investors were moving away from a wide range of firms tied to technology spending, rather than targeting only a few large chipmakers.
The fall in technology shares weighed heavily on the Nasdaq because the index has a large share of major technology companies. It also raised questions about the strength of the market rally seen earlier in the year. Investors have placed high value on companies expected to benefit from AI, but those prices leave little room for weak results or lower growth forecasts.
Not every part of the market moved lower. Energy shares gained as oil firms posted stronger results. Exxon Mobil rose 2.2%, while Chevron added 2.8%. These gains offered some support, although they were not enough to offset the broad decline in technology stocks. Starbucks shares fell 1.8%.
Crypto-linked stocks also came under pressure. Coinbase, Strategy and Robinhood fell between 7.2% and 10.6%. The declines followed reports that hackers had stolen $6.3 billion from Binance. The reported theft added to concerns about risk in the digital asset market and weighed on companies with close ties to crypto trading and investment.
Despite Friday’s losses, the broader earnings season has shown strength across many US companies. About 299 firms in the S&P 500 had reported results by the end of the period. Of those companies, 82% had beaten market expectations. Analysts were also looking for third-quarter earnings growth of 31.6%.
However, strong earnings across the wider market have not removed investor concerns about technology valuations. Investors are now seeking clearer signs that AI spending will support lasting revenue and profit growth. Large budgets alone may no longer be enough to keep share prices rising.
For October, the Nasdaq and S&P 500 recorded monthly losses, while the Dow still gained. Friday’s sharp sell-off highlighted the risks facing markets that depend heavily on a small group of high-value technology firms. Investors are likely to focus on upcoming earnings reports and company forecasts to judge whether AI investment can justify its growing cost.
