Shares of U.S. technology megacaps fell sharply on Monday as investor concerns around AI spending intensified. The selloff weighed heavily on major technology companies, raising fresh questions about whether massive AI investments will deliver meaningful returns.
SpaceXÂ declined for the third consecutive session, falling more than 10% after its strong post-IPO rally last week. The Elon Musk-led company also announced a new notes offering, which added to investor caution.
Alphabet dropped 6%, marking its biggest one-day decline since May 2025. The stock was on track to erase over $256 billion in market value, making it one of the day’s biggest losers.
Adding to market concerns, Google DeepMind lost senior research scientist and Nobel laureate John Jumper, who is leaving to join AI startup Anthropic. His departure raised further concerns about talent shifts in the AI race.
AI Spending Concerns Pressure Big Tech Stocks
According to market analysts, the selloff reflects growing anxiety around the massive capital spending required to build AI infrastructure. Investors are increasingly demanding clearer evidence of long-term returns from these investments.
Amazon fell 4.8%, while Meta and Microsoft each slipped around 3%. Together, these three companies were set to lose more than $248 billion in combined market value.
Hyperscalers have committed billions of dollars to expand AI data centers, chips, and cloud infrastructure. However, concerns remain over how quickly AI-powered products can generate revenue to justify these aggressive investments.
David Wagner of Aptus Capital Advisors noted that this pullback reflects broader uncertainty across the technology sector. Investors appear cautious as AI spending continues to climb without immediate profit visibility.
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Chip Stocks Continue to Benefit from AI Boom
While tech giants struggled, chip-related stocks moved higher as investors favored companies directly benefiting from AI demand. Memory chipmakers and storage firms emerged as clear winners during Monday’s trading session.
Micron Technology jumped 5.8%, reaching record highs. The company also announced a strategic agreement with Anthropic to support next-generation AI infrastructure expansion.
Wagner highlighted a growing divide in the market between companies funding AI infrastructure and those supplying the technology behind it. Chipmakers and storage providers currently appear better positioned to benefit from rising AI demand.
Companies like SanDisk and Western Digital have become top performers in the S&P 500 this year. Their strong gains reflect Wall Street’s confidence in sustained AI-driven demand for storage and memory solutions.
