On February 5th (Wednesday), all three major U.S. stock indices experienced a widespread downturn. The technology-dominated Nasdaq index, in particular, plummeted by over 2% at one juncture, marking its fourth decline in five trading sessions. This sell-off was fueled by mounting concerns that artificial intelligence (AI) could potentially disrupt the profit models of software and data firms.
Amid this market turmoil, chipmaker AMD reported earnings that fell short of market expectations, triggering a sharp 16%+ drop in its stock price—the steepest decline since 2018. Investors have long harbored apprehensions that AI advancements could erode the profitability of code developers, database providers, and IT services companies. These fears were further stoked by recent product launches from firms like Anthropic, which unveiled new AI-powered tools.
However, NVIDIA CEO Jensen Huang has offered a counter-narrative, dismissing the notion of AI rendering software obsolete as "highly illogical." His stance underscores the ongoing debate over AI's long-term impact on the tech sector's economic landscape.