Nasdaq falls more than 2% as investors rotate out of tech after Amazon, Intel earnings

The Nasdaq Composite tumbled on Friday, while the Dow Jones Industrial Average outperformed as traders moved out of key stocks related to artificial intelligence and into more defensive areas of the market.

The tech-heavy Nasdaq lost 2.3%, while the blue-chip Dow was down 307 points, or 0.6%. The S&P 500 slid 1.4%.

Amazon shares lost 1% after the company reported earnings and revenue for the third quarter that fell short of Wall Street’s expectations. The company also posted negative free cash flow of $42.4 billion and maintained its 2026 capital expenditures forecast for $220 billion.

Intel, meanwhile, slide 28% after issuing a weak outlook for the current quarter, pointing to a slowdown in PCs. Revenue in the company’s client computing and physical artificial intelligence group declined 5% from the year-ago quarter to $8.1 billion.

Sandisk was also down 10%, even as its fiscal first quarter results beat estimates. The data storage company announced an eight-for-one forward stock split.

Chipmakers more broadly were under pressure as well. Advanced Micro Devices dropped 9%, while others such as Nvidia and Broadcom fell 3% and 5%, respectively.

As investors rotated out of tech, defensive areas such as consumer staples and healthcare saw gains. Walmart and Coca-Cola each rose nearly 2%, while Procter & Gamble climbed more than 1%, supporting the Dow. Fellow Dow members Merck and Amgen added around 2%.