Nasdaq falls 3.4% as AI spending worries hit tech stocks and Intel sinks nearly 31%

Technology stocks led a broad sell-off on Wall Street on Friday, sending the Nasdaq Composite down 3.4% to its lowest level in nearly three months as investors questioned how long it will take the biggest companies' heavy spending on artificial intelligence to pay off.

The Nasdaq lost 881.35 points to close at 25,303.37, Reuters reported. The S&P 500 fell 2.08% to 7,559.85, and the Dow Jones Industrial Average dropped 566.81 points, or 1.08%, to 51,778.86. The Nasdaq has fallen more than 8% from its record close on Oct. 6, according to Reuters, and Yahoo Finance reported the index was on track for its worst month since March 2025.

The slide followed quarterly results released late Thursday. Intel shares fell nearly 31% after the chipmaker's outlook came up short and it warned it would burn cash this year, citing a weak PC market, manufacturing hurdles and heavy spending to expand production, Reuters reported. Amazon fell about 2% after reporting a sharp cash outflow in the third quarter and signaling higher capital spending next year.

The losses spread across the chip industry. Nvidia fell 5.3% and AMD dropped 12.1%, while a broad index of chip stocks lost 8.7%, according to Reuters. Server makers Dell and HP fell 12.5% and 10.8%.

Friday's drop came a day after Alphabet shares suffered their worst day in more than 20 years following its own earnings, Yahoo Finance reported. Energy was one of the few bright spots, as shares of Exxon Mobil and Chevron briefly touched record highs after both companies said wider refining margins tied to the war in the Middle East lifted their earnings. Oil also rose, with Brent crude reaching $113 a barrel and U.S. crude reaching $104.