US tech stocks see sharp falls over AI cost fears
Major American technology shares fell sharply as investors questioned whether the huge spending on artificial intelligence will soon pay off.
Technology shares on Wall Street fell hard on Friday, with the tech-heavy Nasdaq opening at its lowest point in more than two months. Investors are growing anxious about the rising price of building artificial intelligence systems and whether that spending will produce matching returns.
Chip maker Intel suffered the steepest damage, with its shares dropping by as much as thirty percent in early trading after it warned of a weaker market for personal computers even as it planned to spend more on artificial intelligence. The fall put the company on course to lose more than one hundred and thirty billion dollars in market value.
Other big names fell too. Amazon dropped after disappointing earnings, while Reddit fell by about twenty-six percent and Roblox by nearly twenty percent as both reported weaker user figures. Alphabet had already lost more than five hundred billion dollars in value the day before.
The debate now is less about whether artificial intelligence matters than about how quickly it will make money, and who will bear the cost of getting there.
Reporting based on coverage from BBC News.