Nvidia and Qualcomm Plunge Over 9% as Election Results Shake AI Stocks

A steep selloff hit semiconductor companies on Thursday, driving the Nasdaq down 5.5% in its worst single-day drop in 19 months. The market downturn followed recent election results that sparked concerns over potential slowdowns in artificial intelligence infrastructure expansion.

Chipmakers and Neoclouds Stumble

Nvidia dropped more than 9%, erasing roughly $450 billion in market value. Qualcomm also fell over 9% after issuing a disappointing earnings forecast for the current quarter. Advanced Micro Devices, Micron, and Applied Materials all recorded double-digit percentage declines. Neocloud providers such as CoreWeave dropped for a second consecutive session.

Shares of Tesla and SpaceX each declined more than 9%. Meanwhile, hyperscalers Meta, Alphabet, Amazon, and Microsoft saw their share prices fall between 2% and 4%. Several tech giants have faced cash strain from heavy infrastructure investments; Meta posted negative free cash flow in its latest quarter, following similar results from Alphabet and Amazon in the prior period.

Election Hurdles and Supply Constraints

Wall Street’s retreat coincides with political shifts in key states targeted for data center expansion. Democratic candidates won races in Texas, Ohio, and Georgia. Additionally, voters considered 41 local ballot measures across 10 states designed to restrict data center construction. Voters approved restrictions in 40 of those measures, rejecting limits only in Harwood, North Dakota.

Meta President Dina Powell McCormick noted at a tech conference that building data centers will become harder following the elections. Alongside local resistance, rising interest rates, heavy debt burdens, and high capital needs are weighing on investor sentiment.

Hardware supply constraints also cloud the horizon. Qualcomm reported $650 million in quarterly data center revenue, primarily from connectivity and customization, but noted that output is constrained by component availability. A worldwide shortage of memory chips is driving up component prices, affecting hardware makers like Intel and AMD despite strong baseline demand.