Tech stocks set to wipe out more than $1 trillion as concerns deepen about the AI boom

Technology stocks sold off sharply Friday as investors reassessed the returns from escalating artificial-intelligence spending. The Nasdaq 100 fell 3.4% in early afternoon trading, putting it on course to lose more than $1 trillion in value and record its worst one-day decline since mid-June. The S&P 500 fell more than 1.7%, while its technology sector dropped over 4.1%. The Nasdaq Composite declined 2.7%, the Philadelphia semiconductor index sank 7.8%, and the DRAM ETF fell 7.2%. Amazon shares fell 3% Friday after dropping as much as 10% late Thursday. The company reported faster-than-expected AI infrastructure spending alongside slower growth in its online retail business. CEO Andy Jassy said Amazon expects about $220 billion in 2026 cash capital expenditures, mostly for AWS, and plans to spend meaningfully more in 2027. Intel shares plunged 30% after the chipmaker forecast fourth-quarter profit and sales below expectations; CEO Lip-Bu Tan cited manufacturing constraints, supply shortages, a memory crunch and softer PC demand. Alphabet lost about $500 billion in market value Thursday, its worst day ever, before falling another 1% Friday. Investors have become more skeptical as major technology companies borrow heavily for AI data centers while some AI customers tighten token budgets and question adoption benefits.