Intel's record crash caps a week when the AI trade cracked (opens the source in a new tab)
- Intel fell 29% on Friday, its worst session ever, after warning that memory-chip prices inflated by the AI boom will keep PC sales weak, the WSJ reports. The Nasdaq composite fell 2.9%, its worst day since June.
- Alphabet had its worst day on record as Google's search-ad growth slowed, partly due to AI mode, while Amazon's free cash flow plunged. With the Fed raising rates in September, heavy AI spending now reads as a burden.
- An FT Unhedged column argues cash flow is what moves these stocks now: Meta, Alphabet and Amazon were punished for spending more than expected, while Microsoft's restraint kept its shares steadier.
Why it matters For months the biggest tech firms calmed AI doubts by printing profits. If their own earnings growth is now slowing, the trade loses the cushion that kept smaller, debt-laden AI players afloat, and index-heavy portfolios feel it first.
Other side One bad week is not a bust. Some investors expect AI listings and a calmer Middle East to restart the rally, and steep falls in quality names have often proved buying chances.