NEW YORK (The Thursday Times) — Intel shares plunged as much as 30 per cent on Friday and the tech-heavy Nasdaq opened at its lowest level in more than two months, as fears over the cost of the artificial intelligence race spread across the technology sector a day after Google’s owner lost $500 billion in value.
The chipmaker was on track to lose more than $130 billion in market value after warning of a weaker personal computer market even as it ramps up spending. Finance chief David Zinsner said Intel did not expect to bring in more cash than it spent this year, forecast lower-than-expected fourth-quarter revenue and said the PC slowdown would continue “at least through the first half of next year”.
The Nasdaq opened down 2.5 per cent. Reddit fell 26 per cent after reporting weaker-than-expected daily users and warning that Google’s AI-driven search was cutting referral traffic, and gaming platform Roblox dropped nearly 20 per cent as its daily active users fell.
Amazon shares fell as much as 6 per cent before recovering to trade about 1.6 per cent lower, after it disclosed it was spending more cash than it made, while Alphabet slipped another 1 per cent following Thursday’s record slide, when it said its own AI summaries were hurting search advertising.
“The thinking is that these signs suggest that the entire sector is going to slow down,” Chris Low of FHN Financial told Reuters, adding that the biggest tech companies were “showing some pretty significant growing pains as they aggressively pursue the AI build-out”.
