Shares of major “Magnificent Seven” technology companies were headed for steep weekly losses Friday morning as investors grew increasingly skeptical about the sustainability of the valuations and sky-high spending levels that have defined AI development thus far.
Leading chipmaker Nvidia (NVDA) lost about 3% in the first hour of trading Friday morning, after a Trump administration official said “there will be no federal bailout for AI” and following CEO Jensen Huang’s comments that the United States is on the verge of losing the AI arms race to China. Nvidia is down more than 9.5% over the past five days, on track for its worst week since April.
Shares of Meta (META) and Microsoft (MSFT), which both unveiled massive spending plans for the year, lost about 2.5% and 0.5%, respectively. They have each lost more than 4% over the last five days.
The Magnificent Seven experienced their latest shock after the market closed on Thursday, when Tesla (TSLA) shareholders awarded CEO Elon Musk compensation potentially worth $1 trillion. The electric vehicle maker and computer hardware company lost another 3.5% Friday morning.
Chipmaker Intel (INTC), which is not a member of Magnificent Seven but is directly linked to several companies, was one of the only green spots among Big Tech on Friday morning, up about 1%. Musk said at Tesla’s shareholder meeting Thursday that Tesla would need to develop large chipmaking capacity to power its self-driving electric vehicles, and thought the automaker could work with Intel on that goal.
Rounding out the group, Alphabet (GOOG) and Amazon (AMZN) are both headed for losses of more than 1%, while Apple (AAPL) is headed for a gain of just over 0.2%, bucking the trend.
Chipmakers AMD (AMD) and Broadcom (AVGO) were both down more than 2% on Friday, heading for weekly losses of more than 9% and more than 5%, respectively.
