Is Wall Street losing faith in AI?

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illuminem summarises for you the essential news of the day. Read the full piece on TechCrunch or enjoy below:

🗞️ Driving the news: Tech stocks saw sharp declines this week, raising concerns about investor confidence in artificial intelligence
• The Nasdaq Composite fell 3% — its worst weekly performance since April
• AI-focused firms were among the hardest hit: Palantir dropped 11%, Oracle 9%, and Nvidia 7% as well as Meta and Microsoft, despite reaffirming aggressive AI spending in recent earnings calls, saw their shares fall around 4%

🔭 The context: AI has driven tech valuations throughout 2025, but rising expectations may be outpacing results
• “Valuations are stretched,” said Jack Ablin of Cresset Capital
• Economic headwinds — like the ongoing U.S. government shutdown and weak consumer sentiment — are adding pressureThe broader S&P 500 and Dow Jones were less affected, falling 1.6% and 1.2% respectively

🌍 Why it matters for the planet: AI supports climate action by enabling smarter energy use, emissions tracking, and environmental modelling
• A dip in investment could slow climate tech development, particularly for startups
• Ensuring AI remains focused on real-world sustainability impact is critical as investor scrutiny intensifies

⏭️ What's next: Markets will closely watch earnings and guidance from AI firms
• Investors are likely to shift focus toward measurable outcomes and profitability
• Regulatory developments in the U.S. and EU may also influence future investment decisions

💬 One quote: “Just the slightest bit of bad news gets exaggerated… and good news is just not enough,” said Jack Ablin, CIO of Cresset Capital

📈 One stat: The Nasdaq Composite Index fell 3% this week, driven by steep losses in top AI and cloud computing stocks

See on illuminem's Data Hub™ the sustainability performance of Microsoft, Meta, and Nvidia and their peers OpenAI and Alphabet

Click for more news covering the latest on green tech and corporate governance