AI stocks stumbled as investors questioned valuations and rising market concentration, today, Dec. 17, 2025. S&P 500 fell 1.16% to 6,721.43, the Nasdaq Composite slid 1.81% to 22,693.32 on tech and AI weakness, and the Dow Jones Industrial Average (DJINDEX:^DJI) lost 0.47% to 47,885.96, easing from recent highs.

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Some prominent investors who have successful track records of calling other market declines have become vocal critics of the AI boom. Michael Burry and Jim Chanos are both shorting Nvidia stock, meaning they will make money if the price goes down further.

However, Alphabet has long benefited from a massive level of liquidity and considerable free cash flows. In late 2024, it pledged to spend $75 billion on capital expenditures (capex) in 2025, later raising that to the $91 billion-$93 billion range.

Continued AI adoption and capex spending are likely to fuel further gains, but investors should be aware that a bubble may develop down the road.

US stocks fell as investors shifted away from AI stocks, with Oracle, Nvidia, and AMD taking significant hits amid financing concerns and broader market volatility. Insights into the AI profitability challenge and economic signals ahead.

While there are some concerns about the possibility that the AI market may be in a bubble, it's important to note that ASML, like Nvidia, is highly profitable. The company's gross margins hover in the low 50% range, and in the first nine months of this year, its diluted earnings per share were $17.38 -- a 40% increase from the same period in 2024.

The "Magnificent Seven" stocks have been the primary driver of this market power concentration. Those seven companies — Microsoft ( MSFT ), Amazon ( AMZN ), Alphabet ( GOOGL ), Meta ( META ), Tesla ( TSLA ), Nvidia ( NVDA ), and Apple ( AAPL) — are essentially powering the artificial intelligence boom.

Wednesday's selloff in shares of Oracle was being identified as the main factor triggering declines in all three major U.S. stock indexes, by reviving worries about AI spending.

Are we in an AI-driven stock market bubble?” It seems that in the fall of 2025, you haven’t been able to go anywhere without that question being asked. So, let’s analyze

The artificial intelligence (AI) stock has lost nearly half of its value this year, but its sales have been rising fast.

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