Investors punished technology shares as costly artificial intelligence projects, weaker forecasts and heavy cash spending raised new questions about future returns.
NEW YORK CITY, NY — U.S. stocks fell sharply Friday as investors pulled back from technology companies at the center of the artificial intelligence boom, with the selloff erasing more than $1 trillion in market value and sending the Nasdaq to its steepest decline since June.
The Nasdaq Composite dropped 2.86% on Oct. 30, while the S&P 500 fell 1.82% and the Dow Jones Industrial Average lost 1.09%. The decline capped a difficult month for many technology stocks as investors questioned how quickly enormous investments in data centers, chips and other AI infrastructure will produce enough profit to justify their cost.
Technology shares carried most of the damage. Intel plunged 28.6% after the chipmaker issued a weaker-than-expected outlook and warned that it did not expect positive cash flow this year. Nvidia fell 4.2%, while Advanced Micro Devices dropped 10.9%. The broader semiconductor index declined 7.2%, according to Reuters. Cboe said the technology selloff erased more than $1 trillion in value during Friday’s session.
Intel’s decline followed a forecast that highlighted continued weakness in the personal computer market as well as the high cost of expanding manufacturing and competing in AI. The company forecast quarterly revenue more than $1 billion below Wall Street expectations and said weaker PC demand could continue into the first half of 2027. The stock’s decline was its worst in decades.
Amazon added to the concerns after reporting heavy spending and signaling that capital expenditures are likely to rise again. The company has been investing aggressively in data centers and computing capacity to meet demand for artificial intelligence through Amazon Web Services. Amazon shares finished down 1.4% after falling more sharply before the market opened.
The reaction reflected a broader change in how investors are judging the AI boom. Strong growth in cloud computing and demand for AI services have helped technology companies reach record valuations, but investors are paying closer attention to the cash required to support that growth. Amazon, Alphabet, Microsoft and Meta have collectively committed enormous sums to servers, chips, power and data-center construction, raising questions about how long shareholders will have to wait for those investments to generate stronger returns.
Those concerns had already shaken the market before Friday. Alphabet shares fell 12.6% Thursday after the Google parent reported results showing that rising AI spending had pushed its cash flow into negative territory. The stock lost another 1.4% Friday. The Nasdaq 100 was down more than 5.8% for October, putting its monthly loss in market value above $2 trillion.
The decline was not spread evenly across the market. Energy shares gained after Exxon Mobil and Chevron reported stronger-than-expected profits, while investors also moved money into U.S. government bonds. Treasury prices rose and yields fell as traders sought assets generally considered safer during periods of stock-market volatility.
Despite Friday’s losses, the broader market remained higher for the year. The S&P 500 was up 10.7% for 2026 through Friday’s close, the Dow was up 7.7% and the Nasdaq was up 9.4%. The S&P 500 and Nasdaq nevertheless finished October lower, while the Dow posted a monthly gain.
Wall Street’s next test will come as investors examine another round of corporate earnings and updated spending plans. Apple is scheduled to report results after the market closes Monday, providing another major look at technology demand as investors decide whether Friday’s selloff represents a short-term reset or a broader reassessment of the price being paid for the AI expansion.
Author note: Last updated October 31, 2026.