AI Stock Sell-off: Amazon, Intel shares plunge on earnings misses

AMZN stock sinks over 6% after earnings miss.
INTC stock plunges 25% on lowered Q4 outlook.
SNDK sheds 9% despite positive Q3 performance.
NASDAQ 100 futures give up 2.6% in Friday premarket.

Clay Webster FXStreet

Alphabet's (GOOGL) post-earnings plunge on Thursday might have got the ball rolling, but Amazon (AMZN) and Intel (INTC) have sealed the fate of hundreds of stocks tied to AI on Friday. The latter two are leading an industry wide plunge among AI stocks on Friday after they delivered worrisome quarterly results late Thursday.

Amazon produced GAAP EPS of $1.89, missing the Wall Street consensus by $0.07 for the third quarter. Revenue of $201.9 billion also missed consensus by $360 million.

Intel, on the other hand, beat its top and bottom line consensus for Q3, but its fourth-quarter guidance came in well below expectations. Intel guided for $15.5 billion in revenue at the midpoint, well below the $17 billion that market analysts were expecting. Likewise, adjusted EPS in Q4 was guided to $0.25 instead of the $0.44 consensus.

Amazon stock has traded over 6% lower on the news, while Intel is down a staggering 25% in the premarket, sending shares of the semiconductor giant back to mid-April highs. This twin pair of disappointments, coupled with the Alphabet news from the midweek, has led to a major downswing in the AI trade on Friday.

For instance, memory chip maker Sandisk (SNDK), which beat its consensus handily and hiked its outlook late Thursday, has shed 9% in Friday's premarket despite an impressive quarter. Dell Technologies (DELL) is down 12% in the premarket, and Marvell Technology (MRVL) sinks 6%.

NASDAQ 100 futures have traded 2.6% lower at the time writing, and the iShares Semiconductor ETF (SOXX) is off more than 6%.

Author

Clay Webster

FXStreet

Clay Webster grew up in the US outside Buffalo, New York and Lancaster, Pennsylvania. He began investing after college following the 2008 financial crisis.

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