Is this the beginning of the end of the AI stock market boom?

Investors are reassessing the value of AI-related businesses after a sharp dip in US technology shares, raising questions about whether the AI boom can justify its enormous investment. Analysts differ on whether this is an early warning of weaker returns or a temporary valuation reset, and the article says it is too soon to call the market’s peak.

The Nasdaq 100 fell 5.5% last week after Australian datacentre firm Firmus failed to list at a valuation that could have exceeded Telstra’s, then rebounded in Monday trading. The index remains nearly three times its value at the start of 2023, while seven major technology companies make up 35% of the S&P 500, compared with 12% a decade ago. Analysts point to possible risks including disappointing returns, cheaper open-source AI, public opposition and rising borrowing to fund datacentres; US companies spent $425bn on AI-related capital expenditure in 2025 and are forecast to invest $800bn this year.