US stocks slid on Friday as investors grew wary of rising spending on artificial intelligence. The Nasdaq opened at its lowest level in more than two months, down 2.5%.
Intel shares fell as much as 30% after the chip maker warned of a weaker PC market. Finance chief David Zinsner said the firm did not expect to bring in more cash than it spent this year, and forecast lower-than-expected revenue for its fourth quarter. "Looking ahead, we see the PC slowdown continuing at least through the first half of next year," he said. Intel also said it had significantly ramped up equipment investment in the third quarter and expected that to be "even more significant" in the following three months.
Amazon shares fell as far as 6% before recovering after earnings on Thursday fell short of investor expectations. The company said its spending had increased six-fold over three months and that it was spending more cash than it made. Shares were still down about 1.6% in Friday trading.
Reddit stock fell 26% after the platform reported weaker-than-expected daily user figures. It also warned that Google's growing AI-driven search was hurting referral traffic. Roblox shares dropped nearly 20% as its daily active user numbers fell.
Alphabet, Google's parent, lost more than $500bn in value on Thursday after it said its AI summaries were affecting core search advertising revenue. Its stock fell a further 1% in early trading Friday.
Chris Low of FHN Financial told Reuters that Amazon and Google were "showing some pretty significant growing pains as they aggressively pursue the AI build-out." He said the signs suggested "the entire sector is going to slow down."