Wall Street's technology heavyweights came under pressure on Monday, with artificial intelligence-linked stocks losing hundreds of billions of dollars in market value as investors grew increasingly concerned about the massive spending required to build AI infrastructure.
SpaceX dropped more than 10%, extending losses for a third consecutive session after its sharp post-IPO rally last week. The decline came after the Elon Musk-led company announced it would launch a notes offering on Monday.
Among the biggest losers were AI hyperscalers Alphabet and Amazon. Alphabet fell 6%, putting it on track for its steepest single-day decline since May 2025 and wiping out more than $256 billion in market capitalisation. The stock was also weighed down after John Jumper, a senior research scientist at Google DeepMind and a Nobel laureate, left the company to join AI startup Anthropic.
Amazon declined 4.8%, while Meta Platforms and Microsoft each slipped about 3%. Collectively, the three companies were poised to erase more than $248 billion in market value.
Investors are becoming increasingly cautious about whether the enormous investments being made by technology giants in artificial intelligence infrastructure will generate returns sufficient to justify the spending. The sector-wide weakness reflected broader concerns over rising capital expenditure and the uncertain timeline for meaningful monetisation of AI products.
"The broader sector pullback is being driven by ongoing anxiety over tech companies' massive capital spending on AI infrastructure," experts told Reuters.
Despite the weakness among hyperscalers, semiconductor and data-storage companies continued to outperform. Memory chipmaker Micron Technology rose 5.8% to a record high after announcing a strategic agreement with Anthropic to help scale next-generation AI infrastructure.
"There's a distinguishing aspect of this market between those who are receiving the checks, like memory names, and those who are writing the checks," the expert told Reuters.
Micron, along with data storage companies SanDisk and Western Digital, has emerged among the best-performing stocks in the S&P 500 this year, benefiting from strong investor expectations that demand for AI-related hardware and memory solutions will continue to accelerate.
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