Growing investor anxiety over heavy spending on artificial intelligence has triggered a major sell-off in global technology stocks, wiping out more than $1 trillion in market value among the biggest tech firms. According to PYMNTS and market reports, concerns that companies are spending vast sums without clear near-term returns have dampened investor sentiment, even as AI remains central to future growth strategies.
The sell-off reflects a paradox: although these companies are leading AI innovation and investing aggressively in infrastructure and talent, markets are increasingly questioning whether the billions poured into AI will translate into sustainable profits. The resulting valuation drops show that investors are weighing near-term performance more heavily than long-term visions, a shift from past enthusiasm.
Major players such as Microsoft, Amazon, Alphabet, Apple and Nvidia have all seen significant declines in their market capitalisations — collectively erasing hundreds of billions of dollars this year alone. For example, Microsoft’s shares have fallen roughly 17 % amid fears over competition and AI risks, contributing heavily to the cumulative market losses.
Analysts say this turbulence highlights a broader rebalancing in global markets: while AI remains a transformative force, investors are demanding clearer evidence of profitability and returns before rewarding high valuations. Companies with more stable earnings and less exposure to risky AI spending — such as chip manufacturers and retail firms — have seen gains in contrast to the tech giants.
