Intel plunges as much as 30% as AI spending fears deepen global tech rout

The tech sell-off gained steam with disappointing earnings from leading companies. Meta, Alphabet, Oracle, Amazon and Microsoft have committed to spending $800.6bn between them in 2026 alone, and investors are questioning whether that spending will produce profits quickly enough.

Intel tumbled despite reporting a stronger than expected third-quarter profit, after forecasting fourth-quarter revenue below analysts' expectations and saying it planned to increase spending on AI. Its finance chief, David Zinsner, said the PC slowdown would continue at least through the first half of next year. Intel was flirting with its worst day since 1974.

Amazon shares fell as much as 6% in overnight trading after the company offered a cautious sales forecast for the holiday quarter and reported third-quarter results below expectations. Amazon has committed $220bn to spending this year, including on AI data centres, network equipment and servers, and said its spending increased six-fold in three months. Reddit fell 26% after reporting weaker than expected daily user figures, and Roblox dropped nearly 20%.

The Nasdaq Composite fell more than 3% after opening at its lowest level in more than two months, down 2.5%. The S&P 500 slipped 1.2% and the Dow Jones Industrial Average 0.4%. Alphabet, which slid 12% on Thursday in its worst day since listing as Google in 2004, was down a further 1% in early trading. Despite the rout, the Nasdaq remains 7.6% higher than a year ago.

"This has been one of the worst tech earnings seasons in memory, with underwhelming results from a slew of very prominent companies," said Adam Crisafulli of Vital Knowledge. "Investors have turned ruthless, punishing any signs of disappointment in [third quarter] earnings," said Kathleen Brookes of XTB. "The AI trade has had a good run in recent years, but now investors want payback, and companies like Alphabet and Intel are in the crosshairs." Anna Wu of Floodlines Research said the concern was not that AI demand had slowed, but that higher funding costs and credit risk could eventually force hyperscalers to slow their build-out. UBS advised clients to "diversify beyond AI."

The selling spread across Asia, with Seoul down more than 3% and Tokyo and Taipei down more than 2%. South Korean chipmaker SK hynix dived more than 7%, Japan's Kioxia shed more than 7%, Advantest and SoftBank skidded nearly 6%, Samsung lost 3% and TSMC 1.9%. Hong Kong, Sydney, Mumbai and Wellington rose.

Beyond stocks, bitcoin tumbled about 5% to a one-month low of around $76,400 after Binance, the world's largest crypto exchange, said a hack had impacted about $6.3bn in funds. The exchange said it would cover all losses and that about $3bn had been frozen on-chain. At $77,000, bitcoin was on course for its worst October since 2014, down 7.7% for the month. Gold traded as low as $3,891 an ounce, its weakest in a year.

Oil climbed, with Brent up 2.5% at $113.51 a barrel, heading towards $120 for the first time since April. The British military reported a tanker was disabled by explosives attached by a small boat in the Strait of Hormuz. Attention is turning to Tuesday's US midterm elections and the impact they could have on the final two years of Donald Trump's presidency. Michael Hewson of MCH Market Insights said oil, not the vote, was the bigger risk to markets: "Does the outcome matter for the markets, probably not, although a crude oil price which moves above $120 a barrel could well be another story."