<div id="readability-page-1"><div> <p>Friday turned into another brutal day for artificial intelligence stocks. Broadcom shares tanked over 11 percent, dragging down Nvidia, Advanced Micro Devices, and Oracle with it. Major indexes closed lower despite tech companies posting earnings that should have sent stocks soaring. The disconnect between company performance and market reaction is honestly kind of wild.</p> <p>Here’s what makes this selloff so confusing. Broadcom’s earnings crushed expectations. Their guidance for the current quarter also came in way above what analysts predicted. By every measurable standard, the company delivered exactly what investors claim they want to see. Yet the stock crashed anyway, taking the entire AI sector down with it.</p><br/> <h3><strong>The earnings that weren’t good enough</strong></h3> <p>Broadcom reported results that should have thrilled investors. Revenue growth accelerated, AI revenue continues climbing, and management raised their outlook for the year. Analysts covering the stock couldn’t figure out what more people wanted from the company.</p> <p>Bernstein analyst Stacy Rasgon, who rates Broadcom as a buy, wrote that he wasn’t sure what else anyone could desire. The company’s AI business keeps overdelivering and the growth rate is actually accelerating rather than slowing down. Those are the metrics that matter most for tech valuations right now.</p> <p>But investors fixated on lower profit margins and uncertainty around future deals instead of celebrating the massive revenue beat. The market basically decided that good news wasn’t good enough when everyone’s nervous about an AI bubble. Any hint that growth might not continue forever triggers panic selling regardless of current performance.</p> <h3><strong>The week tech forgot</strong></h3> <p>The Dow Jones Industrial Average actually rose 1.1 percent for the week thanks to financial stocks performing well. But the tech-heavy Nasdaq Composite dropped 1.6 percent while the broader S&amp;P 500 fell 0.6 percent. Technology names single-handedly dragged down major indexes despite strength in other sectors.</p> <p>This selloff followed record highs earlier in the week. Markets hit all-time peaks Thursday, then immediately reversed Friday when Broadcom reported earnings that should have pushed stocks even higher. The whiplash from record highs to significant losses within 24 hours shows how unstable investor sentiment has become around AI stocks.</p> <p>Nvidia, AMD, and Oracle all fell in sympathy with Broadcom despite having nothing to do with the earnings report. This contagion effect reveals how interconnected AI stock trading has become. When one major player drops, everything else follows automatically as algorithms and momentum traders pile on.</p> <h3><strong>The bubble fears driving everything</strong></h3> <p>Investors are genuinely spooked about an AI bubble forming. The sector has run up so dramatically that any sign of weakness triggers massive selling. People remember previous tech bubbles and don’t want to hold stocks when the music stops, so they’re looking for reasons to sell rather than reasons to buy.</p> <p>The narrative around AI has shifted from “this will change everything” to “maybe this is overhyped” remarkably quickly. Companies are still delivering strong results and growth, but skepticism is creeping into analyst reports and investor conversations. Once doubt starts spreading, it feeds on itself regardless of underlying fundamentals.</p> <p>UBS strategists remain optimistic, expecting AI themes to drive strong performance through 2026. They point to high profitability and accelerating impact across multiple technology sectors. But long-term bullish views don’t help much when short-term traders are panicking and hitting sell buttons indiscriminately.</p> <h3><strong>What happens next</strong></h3> <p>The near term looks volatile until something concrete reassures jittery investors. Analysts specifically mentioned Oracle achieving positive cash flow as the type of milestone that could calm fears. Investors need proof that AI investments are generating actual profits, not just revenue growth and promises about future potential.</p> <p>Future prospects still look strong according to most professional analysts. The energy transition, AI development, and data center buildouts all require massive technology investments that should support continued growth. The fundamentals supporting tech stocks haven’t changed, even though sentiment has soured dramatically.</p> <p>But fundamentals don’t matter much during panic selling. Markets can stay irrational longer than you can stay solvent, as the old saying goes. Tech investors who bought at recent highs are now underwater despite companies posting record earnings. That’s the reality of trading during bubble fear episodes when psychology overwhelms logic.</p> <p>The question isn’t whether AI companies are performing well. They clearly are. The question is whether investors believe the valuations are sustainable or whether we’re witnessing the beginning of a larger correction that could drag tech stocks significantly lower before sentiment stabilizes again.</p> </div></div>

<p>AI stocks crashed despite positive earnings reports, with Broadcom shares dropping over 11%, affecting Nvidia, AMD, and Oracle. Despite strong revenue growth and raised outlook, investors focused on lower profit margins and AI bubble fears, leading to panic selling. Major indexes fell, driven by tech stocks, despite other sectors performing well. Analysts remain optimistic about AI's long-term prospects, but short-term volatility persists due to investor skepticism and fear of overvaluation.</p>

- Artificial intelligence stocks faced a significant selloff, with Broadcom's shares dropping over 11 percent despite strong earnings and optimistic guidance.  
- The market's reaction reflects growing fears of an AI bubble, leading to panic selling as investors prioritize profit margins and future uncertainties over current performance.  
- While analysts remain optimistic about the long-term prospects of AI and technology investments, short-term volatility is expected until investor confidence is restored.

Why AI stocks crashed despite beating forecasts