AI firms saw a $190 billion decline in market capitalization after reports from Microsoft and Alphabet

AI firms saw a $190 billion decline in market capitalization after reports from Microsoft and Alphabet

AI firms saw a $190 billion decline in market capitalization after reports from Microsoft and Alphabet

The selling that ensued after the bell, prompted by the reports from the tech titans, highlighted the heightened expectations of investors in the wake of the AI-driven stock market surge in recent months, which lifted their shares on the promise of integrating technology into the corporate environment. to an all-time high.

Following the release of quarterly results by Microsoft, Alphabet, and Advanced Micro Devices that did not meet the expectations of investors who had increased their share prices, the stock market value of AI-related businesses dropped by $190 billion late on Tuesday.

The selling that ensued after the bell, prompted by the reports from the tech titans, highlighted the heightened expectations of investors in the wake of the AI-driven stock market surge in recent months, which lifted their shares on the promise of integrating technology into the corporate environment. to an all-time high.

Alphabet dropped 5.6% as a result of the parent company of Google's lower-than-expected December quarter ad revenue.

Alphabet also revealed that it would be spending more on data centers this year to support its AI initiatives, underscoring the steep price of its intense rivalry with Microsoft in the field of artificial intelligence.

Microsoft's Azure has risen more quickly than Google Cloud, despite the latter's revenue growth being somewhat over Wall Street expectations due to interest in AI.

Microsoft's quarterly revenue above analysts' projections because to new artificial intelligence capabilities that drew users to its Windows and cloud services. Nevertheless, Tuesday's intraday record saw its shares drop 0.7% during prolonged trade after a record high.

This month, optimism over AI propelled Microsoft's stock market worth past $3 trillion, surpassing Apple.

Despite anticipating higher sales of its AI chips, chipmaker Advanced Micro saw a 6% decline in stock after missing revenue projections for the first quarter.

Nvidia's stock lost some of its gains in extended trade, falling more than 2%, after having risen more than three times last year on confidence about AI. The company's shares had jumped 27% in January.

Super Microcomputer, a provider of servers and another business that has profited from demand for AI, had a decline of more than 3%. It had set a new high earlier on Tuesday after the release of stellar quarterly earnings the day before.