Asked whether the week's tech sell-off means the AI bull case is broken, Adami says investors are now questioning the capex itself. It frames the trap the market has put the big AI spenders in.
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…the day at three-month lows. Alphabet, which reported Wednesday, had its worst day ever yesterday, lost more than a half a trillion dollars in market cap this week. So does this week's tech devastation suggest the bull case for AI is broken? Or maybe it's just on pause. Guy, what do you think?
…today. So what does it all mean? Well, all of a sudden now I think people are taking a critical look. Steve mentions free cash flow. All the big names, the five, six biggest names now on the planet, XNVIDIA, are probably all negative cash flow right now, which is, I think, problematic. And I think now people are starting to question, wait a second, the spend is what it is. That's a problem. You're not seeing the return on the spend. So now we're at a point where you're getting punished if you spend. But what happens if they stop spending? The market will get punished on the back of that. Microsoft curtailed its spending. So didn't make a difference. That's going to be, I think we're sort of at that point now, I think, in the spectrum.
Yeah, so it's Microsoft, NVIDIA, and Apple are the ones that have all the cash. The rest are, to Guy's point, free cash flow negative. But if you think about it, so Alphabet is two quarters now, free cash flow negative. And then Meta is one quarter free cash flow negative. Amazon is a full year. So…
Damage done.
Well, lots of it. Yes. I mean, let's take the superlative. Did you say Intel was the worst day? What was it? 74. 74. Well, guess what? It had its best day one year ago, up 32% in September of 2025. I mean, that's the thing about superlatives, right? Was the best. That was the worst. The thing is…