{"slug": "magnificent-7-loses-767-billion-as-ai-skeptics-dump-tech-stocks", "title": "Magnificent 7 Loses $767 Billion as AI Skeptics Dump Tech Stocks", "summary": "The Magnificent Seven group of megacap tech stocks lost roughly $767 billion in market value on Thursday, its biggest one-day drop since April 2025, as Alphabet Inc. and Tesla Inc. earnings fueled skepticism about the artificial intelligence trade. Alphabet raised its capital spending forecast to as much as $205 billion this year, while Tesla's profits fell far below expectations and CEO Elon Musk called 2026 \"a massive capex year.\" \"The real problem is the amount of spend that's going on,\" said Ken Mahoney, CEO of Mahoney Asset Management. \"No one knows what the return on investment is.", "body_md": "(Bloomberg) -- The Magnificent Seven group of megacap technology stocks is on track for its biggest one-day drop since the tariff tantrum in April 2025 as results from Alphabet Inc. and Tesla Inc. are casting doubt on the durability of the artificial intelligence trade that has powered the stock market for more than three years.\n\nMost Read from Bloomberg\n\n-\n[Retina Chip Designed to Restore Sight to Go on Sale in Europe](https://www.bloomberg.com/news/articles/2026-07-22/retina-chip-designed-to-restore-sight-to-go-on-sale-in-europe?utm_campaign=bn&utm_medium=distro&utm_source=yahooUS) -\n[Hegseth Turns to UNC, Virginia Tech After Dropping Ivy League](https://www.bloomberg.com/news/articles/2026-07-22/hegseth-turns-to-unc-virginia-tech-after-dropping-ivy-league?utm_campaign=bn&utm_medium=distro&utm_source=yahooUS) -\n[Apple Plans Overhaul of MacBooks, iMac in Push to Meet AI Demand](https://www.bloomberg.com/news/articles/2026-07-22/apple-to-launch-new-macbook-air-imac-macbook-pro-neo-mac-mini-mac-studio?utm_campaign=bn&utm_medium=distro&utm_source=yahooUS) -\n[Alphabet Falls as $205 Billion Spending Plan Fuels AI Cost Fear](https://www.bloomberg.com/news/articles/2026-07-22/alphabet-posts-cloud-sales-beat-slight-miss-on-search-revenue?utm_campaign=bn&utm_medium=distro&utm_source=yahooUS)\n\nThe Bloomberg Magnificent 7 Index was down 4.8% midway through Thursday's session, wiping out roughly $767 billion in market valuation. The declines were led by Tesla and Alphabet, who spooked Wall Street with their earnings on Wednesday. Alphabet raised its capital spending forecast to as much as $205 billion this year, while Tesla's profits came in far below expectations and Chief Executive Officer Elon Musk told investors that 2026 will be \"a massive capex year.\"\n\n\"The real problem is the amount of spend that's going on,\" said Ken Mahoney, chief executive officer of Mahoney Asset Management. \"No one knows what the return on investment is.\"\n\nThe macro backdrop, including oil prices rising as the war with Iran escalates, is increasingly the pressure on these stocks, he added.\n\n\"It's the perfect storm,\" Mahoney said.\n\nThe selloff is coming as investors grow increasingly cautious about the massive sums that Big Tech firms are spending to build out their AI infrastructure. The index is now down 11% from a record hit in late May, erasing $2 trillion in market value.\n\nWednesday's earnings reports fed into those concerns. While Google-parent Alphabet posted encouraging results featuring robust growth in its cloud-computing business, it's spending forecast was more than expected, even though Alphabet had telegraphed the increase when it raised capital in early June. The $45 billion it spent in the second quarter turned its cash flow negative for the first time as a public company.\n\n\"That suggests there's a lot more risk in the stock now than there was before, when it was a cash-generation machine,\" said Jason Lemire, chief investment officer at Bold Wealth Partners.\n\nMeanwhile, Musk said that Tesla \"should be spending on capex as fast as we can — spend as fast as we can without it being too wasteful.\"\n\nTesla shares plunged 13% on Thursday, their biggest intraday drop since June 2025, and Alphabet sank 7.3% to its lowest since April. Other major AI spenders also fell, with Microsoft Corp. down 3.1%, Amazon.com Inc. sinking 5% and Meta Platforms Inc. declining 4.7%. All three report earnings next week.", "url": "https://wpnews.pro/news/magnificent-7-loses-767-billion-as-ai-skeptics-dump-tech-stocks", "canonical_source": "https://ca.finance.yahoo.com/news/magnificent-7-loses-767-billion-165322426.html", "published_at": "2026-07-23 16:53:22+00:00", "updated_at": "2026-07-23 18:22:41.381547+00:00", "lang": "en", "topics": ["artificial-intelligence", "ai-infrastructure", "ai-policy"], "entities": ["Alphabet Inc.", "Tesla Inc.", "Microsoft Corp.", "Amazon.com Inc.", "Meta Platforms Inc.", "Ken Mahoney", "Elon Musk", "Bloomberg Magnificent 7 Index"], "alternates": {"html": "https://wpnews.pro/news/magnificent-7-loses-767-billion-as-ai-skeptics-dump-tech-stocks", "markdown": "https://wpnews.pro/news/magnificent-7-loses-767-billion-as-ai-skeptics-dump-tech-stocks.md", "text": "https://wpnews.pro/news/magnificent-7-loses-767-billion-as-ai-skeptics-dump-tech-stocks.txt", "jsonld": "https://wpnews.pro/news/magnificent-7-loses-767-billion-as-ai-skeptics-dump-tech-stocks.jsonld"}}