Nasdaq falls over 2% as investors reassess massive AI spending costs

31 October 2026 · Source balance: Centre

The Nasdaq fell more than two percent on Friday, October thirtieth, as investors reassessed the enormous costs of building out artificial intelligence infrastructure. Amazon and Intel's disappointing earnings reports intensified concerns about whether companies spending heavily on AI will generate enough returns to justify their investments. Amazon reported significant free cash outflow and maintained its planned spending at two hundred twenty billion dollars for next year, while Intel warned of cash burn and saw its stock plunge nearly thirty percent—one of its worst days on record. The sell-off extended beyond those two companies, wiping out more than one trillion dollars in value across the tech sector. Other semiconductor stocks and AI-related companies also declined sharply. The broader S&P five hundred fell one point eight percent, while the Dow held up better as investors rotated toward defensive sectors like utilities and consumer staples. This represents the tech sector's worst day since June.