Wall Street’s AI Selloff Just Wiped Out Another Wave of Gains 📉
The Nasdaq plunged 2.6% on Thursday, marking its steepest daily drop since June as investors reassessed the price of the AI boom. The S&P 500 fell 1.2%, while chipmakers suffered some of the heaviest losses.
Meta became a major source of concern. Despite beating revenue expectations, the company faced fresh scrutiny over its enormous AI spending after reporting its first cash outflow in more than a decade. Plans to issue new non-voting shares to help fund its expansion added to investor worries.
Tesla also fell despite reporting positive free cash flow and reducing its capital spending plans. The message is getting clearer: strong earnings alone may not be enough when investors fear that AI infrastructure costs are running ahead of future returns. ⚠️
Yet the broader earnings picture isn’t entirely negative. Around 83% of the 111 S&P 500 companies that had reported results so far beat analyst expectations. The real test is whether AI leaders can turn that growth into sustainable profits.
The Nasdaq plunged 2.6% on Thursday, marking its steepest daily drop since June as investors reassessed the price of the AI boom. The S&P 500 fell 1.2%, while chipmakers suffered some of the heaviest losses.
Meta became a major source of concern. Despite beating revenue expectations, the company faced fresh scrutiny over its enormous AI spending after reporting its first cash outflow in more than a decade. Plans to issue new non-voting shares to help fund its expansion added to investor worries.
Tesla also fell despite reporting positive free cash flow and reducing its capital spending plans. The message is getting clearer: strong earnings alone may not be enough when investors fear that AI infrastructure costs are running ahead of future returns. ⚠️
Yet the broader earnings picture isn’t entirely negative. Around 83% of the 111 S&P 500 companies that had reported results so far beat analyst expectations. The real test is whether AI leaders can turn that growth into sustainable profits.
