Tech giants lose billions as markets reassess AI investments
What's the story
The world's leading technology companies, including Microsoft, Amazon, Apple, and NVIDIA, have witnessed a significant drop in their stock prices this year. The decline comes as investors grow wary of the massive investments these firms are making in artificial intelligence (AI). Microsoft has lost a staggering $613 billion in value so far this year with its shares down by 17%.
Market impact
Amazon's stock falls nearly 14%
Amazon's stock has also taken a major hit, falling nearly 14% year-to-date. The company's market value has been reduced by about $343 billion. This comes after Amazon announced earlier this month that it expects its capital spending to increase by over 50% this year. The news has further fueled investor concerns over the potential impact of such high spending on short-term earnings.
Broader impact
Apple, NVIDIA also take a hit
The trend isn't limited to Microsoft and Amazon. Apple and NVIDIA have also seen their market values fall by $256 billion and nearly $90 billion, respectively. This year alone, the tech industry is expected to spend up to $700 billion on AI technology. The massive investments are making stocks volatile, even for the biggest players in the industry.
Resilience amid volatility
TSMC, Samsung gain amid big tech bloodbath
Despite the overall downturn in Big Tech stocks, some companies have managed to buck the trend. TSMC and Samsung have actually gained value as the market shifts. Even Walmart has seen a boost during this tech shakeup. These companies' resilience highlights the complex dynamics of the current tech industry landscape amid rising concerns over AI spending and its impact on short-term earnings.