U.S. stocks closed lower Thursday as renewed concerns over the economics of artificial intelligence triggered a broad selloff across technology and semiconductor shares. The S&P 500 declined 0.5%, while the Nasdaq fell 1.4% as investors reacted to a report indicating that OpenAI’s annualized revenue was substantially below a figure previously reported by other outlets.

OpenAI Revenue Report Shakes AI Trade

The report cited documents indicating that OpenAI’s annualized revenue was approximately $50 billion, rather than the $70 billion figure previously estimated. The discrepancy prompted investors to reassess assumptions surrounding the revenue potential of large language model developers and their ability to ultimately generate profits from the enormous amounts of capital being invested in artificial intelligence.

The concern extends well beyond individual AI companies. Technology stocks have benefited significantly from expectations that accelerating AI adoption will drive demand for semiconductors, cloud computing and data-center infrastructure. Any evidence that AI revenue growth may not match the scale of investment could therefore affect a much broader group of companies.

Chipmakers Lead the Decline

Semiconductor companies absorbed some of the strongest selling pressure. Nvidia declined 2.9%, Broadcom fell 4.6% and Micron lost 4.8%. The moves reflect the market’s sensitivity to expectations surrounding continued AI infrastructure spending, which has become an important source of demand for advanced computing hardware.

Hyperscalers also moved lower. Alphabet declined 0.7%, Microsoft fell 1.3% and Oracle dropped 5.8%. These companies are among the major participants in the expanding cloud and AI infrastructure ecosystem, making their valuations increasingly dependent on expectations for sustained technology spending.

AI Investment Becomes a Market-Wide Question

The latest decline highlights a broader issue facing investors: whether the enormous capital commitments behind AI infrastructure can eventually produce returns that justify the spending. AI investment has supported technology valuations and contributed to economic growth, but the financial benefits remain distributed unevenly across developers, chipmakers, cloud providers and infrastructure companies.

For markets, the question is becoming less about whether AI demand exists and more about whether that demand is growing quickly enough to support the level of investment currently being made. Revenue disclosures from leading AI developers could therefore have an increasing influence on technology-sector valuations.

Energy Markets Add Another Risk

Energy prices also remained volatile as oil prices rebounded amid renewed tensions involving tanker traffic through the Strait of Hormuz and concerns over offshore production in the Gulf of Mexico. Iran’s attacks on tankers and the threat posed by a hurricane to U.S. offshore production introduced another source of uncertainty for investors.

Higher energy prices could complicate the market outlook if they persist, particularly by increasing inflationary pressure and operating costs across the economy. This creates an additional risk alongside the technology-sector concerns that dominated Thursday’s trading session.

What the Market Needs to Watch Next

The broader U.S. stock market remains substantially above year-ago levels despite Thursday’s decline. The U.S. stock market index stood at 7,770 on October 8, down 0.40% from the previous session, but still 15.37% higher than the same period last year. The index reached a record high of 7,844.67 earlier in October.

The pullback therefore does not yet establish a broader reversal. Instead, it underscores how quickly sentiment can change when questions emerge around the economic foundations of the AI boom. Investors will likely focus on future revenue disclosures, corporate AI spending plans and evidence that rising infrastructure costs are translating into sustainable demand and earnings growth.