The Nasdaq Composite dropped roughly 1-2% in trading sessions tied to fresh AI capital expenditure disclosures, with Alphabet’s earnings report serving as the main catalyst. The company raised its 2026 capex guidance to a range of $195B to $205B, up from a prior estimate of $180B to $195B. Tesla added fuel to the fire with its own elevated AI spending plans.
The bill is getting larger, and the revenue is not keeping up
Hyperscalers, the mega-cap tech companies building AI infrastructure at industrial scale, are now projected to spend somewhere between $500B and $700B on AI-related capital expenditure in 2026 alone. Some estimates have already crossed $527B, up from $465B just months prior.
AI capex concerns have driven multiple sessions of downside pressure on the Nasdaq throughout June and July of 2026, creating a persistent ceiling on tech valuations. Chipmakers and mega-cap names have absorbed the brunt of those rotations, as money flows out of growth bets and into sectors with more predictable return profiles.
Crypto caught in the crossfire
The selloff did not stay contained to tech stocks. Bitcoin fell approximately 1.8% to around $64,800 during the period of heaviest Nasdaq pressure, while Ether dropped about 3% to near $1,870. Neither move was driven by any crypto-specific catalyst.
Ether’s steeper decline, roughly 3% versus Bitcoin’s 1.8%, follows a familiar pattern. When risk sentiment deteriorates, Ether tends to move more aggressively than Bitcoin in both directions. That relationship held here.
What investors should watch next
The key question heading into the rest of earnings season is whether any of the major AI spenders can pair their capex announcements with revenue guidance that justifies the outlay. A spending increase paired with strong cloud and advertising growth is a different story than a spending increase paired with flat or decelerating revenue.