Major chipmakers experienced significant declines on Thursday following this week’s midterm election results, which sparked concerns among investors about the pace of artificial intelligence infrastructure expansion. Nvidia and Qualcomm each fell more than 9%, with Nvidia shedding nearly $450 billion in market value. The Nasdaq composite declined 5.5%, marking its steepest drop in 19 months since April 2025.
Qualcomm’s disappointing earnings forecast for the current quarter contributed to the broader selloff in chip stocks. The company reported $650 million in data center revenue during the latest quarter, primarily from customization and connectivity work. Other semiconductor manufacturers also saw substantial losses, including Advanced Micro Devices, Micron, and Applied Materials, all posting double-digit percentage declines. Elon Musk’s public companies, Tesla and SpaceX, each dropped more than 9%.
Election results in key states with major artificial intelligence data center initiatives shifted Democratic, raising questions about future infrastructure projects. Voters rejected 40 of 41 local ballot measures across 10 states that would have restricted data center construction. Meta President Dina Powell McCormick stated at the Wall Street Journal Tech conference that building data centers would become “harder” following the elections. The hyperscalers—including Meta, Alphabet, Amazon, and Microsoft—have committed to annual infrastructure spending exceeding $100 billion, with Meta, Alphabet, and Amazon each turning free cash flow negative in recent quarters.
Wall Street concerns center on the sustainability of growth in the artificial intelligence sector given rising interest rates, substantial capital requirements, and potential limitations on infrastructure expansion. While chipmakers reported strong data center business growth, with Intel posting a 78% jump in data center revenue and AMD more than doubling sales in that segment, investors expressed skepticism about whether the technology’s buyers could effectively utilize the capacity being built. Industry analysts noted that delays and uncertainties in the sector could persist for some time.
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