US stock markets showed signs of recovery on Friday after a turbulent Thursday that saw the Nasdaq Composite drop 1.3%, losing 345 points to close at 27,193.34. The sell-off was driven in part by concerns surrounding OpenAI's revenue disclosures. The company told investors that its annualized revenue reached roughly $50 billion at the end of September, a notable decline from the $68 billion figure reported just a month earlier. Some reports even referenced a previous $70 billion estimate, adding to the confusion. OpenAI, however, projects a $20 billion increase in annualized revenue before the end of 2026, primarily fueled by growth in its enterprise business.
The ripple effects of the AI revenue concerns were felt across the semiconductor sector. Nvidia fell 2.9%, Broadcom lost 4.3%, and Micron dropped 4.8% during the Thursday session. Firmus Grid, a Nvidia-backed Australian data-center operator, also shelved its proposed $5 billion IPO, which would have been Australia's largest in nearly 30 years. Analysts cautioned that a quick rebound in AI-linked stocks is unlikely, though Nvidia shares rose 0.47% and Tesla gained 2.63% by Friday's open.
Micron and Astera Labs present contrasting pictures within the AI hardware space. Micron posted fiscal Q4 revenue of $54.23 billion, up 379.3% year over year, with a gross margin of 87.0%. DRAM prices climbed in the high-teens percentage range, and data center SSD revenue neared $10 billion. Astera Labs, meanwhile, reported revenue of $392.4 million, up 104.5% year over year, with PCIe 6 products comprising over 50% of its revenue. Astera guides Q3 revenue to $540 million to $560 million and plans near-packaged optics chipsets for 2027 production. The two companies also diverge sharply in valuation, with Micron trading at a forward P/E of 7 while Astera trades at 56.
Concerns about a potential slowdown in AI data center spending are raising alarms about broader economic consequences. Private companies were building data centers at a pace of roughly $85 billion annually as of August, 73% more than a year earlier. Construction crews have been kept busy, with about 3,700 workers employed at a single Meta site in Richland Parish. AI-related spending added 1.3 percentage points to U.S. growth in early 2025 but less than half a point by the third quarter. Microsoft CFO Amy Hood indicated the company would slow chip purchases first if demand changed, leaving data center construction crews among the most vulnerable to job losses.
On the regulatory front, the Trump administration now requires AI companies to notify and correct security incidents, a mandate that follows an incident involving Anthropic. Companies must report security problems and take corrective steps. In China, the government announced plans to build technology monitoring, risk warning, and emergency response systems to ensure AI is safe and controllable. The country will also establish a national AI innovation center and a national AI innovation and development zone to serve as a hub for AI-related industries.
Elsears in the market, SpaceX shares rose after agreeing to acquire a nationwide low-band spectrum portfolio, causing telecom shares like T-Mobile, AT&T, and Verizon to fall on competition concerns. Marvell's Investor Day prediction that the AI chip market could reach $37 billion in revenue sent shares of connected companies CIEN and ALAB soaring. PwC Australia launched Cyber Managed Services, an AI-powered cybersecurity offering providing 24-hour monitoring and threat detection. The Goa Chamber of Commerce and Industry also announced free AI training for small businesses in partnership with Ground Floor Labs, following a pilot in Healdsburg, California.
Key Takeaways
- OpenAI's annualized revenue dropped to roughly $50 billion by late September, down from $68 billion reported the previous month, sparking an AI stock sell-off.
- OpenAI projects a $20 billion increase in annualized revenue before the end of 2026, driven mainly by enterprise business growth.
- The Nasdaq Composite fell 1.3% on Thursday, losing 345 points to close at 27,193.34, with Nvidia down 2.9%, Broadcom down 4.3%, and Micron down 4.8%.
- Micron posted fiscal Q4 revenue of $54.23 billion with an 87.0% gross margin, while Astera Labs reported $392.4 million in revenue with PCIe 6 products making up over 50%.
- Firmus Grid, a Nvidia-backed Australian data-center operator, shelved its proposed $5 billion IPO amid the AI market turmoil.
- Data center construction spending is running at roughly $85 billion annually, with Microsoft CFO Amy Hood saying chip purchases would be slowed first if demand changes.
- The Trump administration now mandates AI companies report security incidents, following an incident involving Anthropic.
- China announced plans for a national AI innovation center and development zone, along with technology monitoring and risk warning systems.
- SpaceX's acquisition of a nationwide spectrum portfolio caused telecom shares like T-Mobile, AT&T, and Verizon to fall on competition concerns.
- Marvell's forecast of a $37 billion AI chip market sent CIEN and ALAB stocks soaring, while PwC Australia launched a new AI-powered cybersecurity service.
Nasdaq futures climb after AI stocks face worst drop since August
Nasdaq futures rose on Friday after AI stocks suffered their worst decline since mid-August. OpenAI told investors its annualized revenue reached $50 billion at the end of September, lower than the $68 billion reported the month before. Oil prices fell after President Donald Trump said the US would not strike Iran before the midterms. Analysts warned that a quick rebound in AI-linked stocks is unlikely.
Nasdaq futures gain after AI stocks see worst session since August
U.S. stock futures pointed higher on Friday after a sharp sell-off in AI stocks on Thursday. OpenAI disclosed to investors that its annualized revenue stood at $50 billion as of late September. Firmus Grid, an Nvidia-backed cloud computing company, withdrew from what would have been Australia's largest IPO in nearly 30 years. Analysts said the AI-linked sell-off may not recover quickly.
Nasdaq opens higher as oil retreats and AI stocks recover
US stocks opened higher on Friday as oil prices retreated and investors assessed AI stocks. OpenAI told investors its annualized revenue reached around $50 billion at the end of September, below the $68 billion figure reported previously. SpaceX shares rose after agreeing to acquire a nationwide low-band spectrum portfolio, causing telecom shares like T-Mobile, AT&T, and Verizon to fall. Nvidia shares rose 0.47% and Tesla gained 2.63%.
Nasdaq rises after OpenAI revenue report shakes AI stocks
U.S. stocks rose on Friday after a sell-off driven by concerns about AI revenue growth. OpenAI told investors it had $50 billion in annualized revenue at the end of September, below the $68 billion reported the previous month. SpaceX climbed on a deal to acquire a nationwide spectrum portfolio while AT&T, Verizon, and T-Mobile fell on competition concerns. Oil prices retreated after Trump pledged not to attack Iran before the midterms.
Nasdaq drops 1.3% as AI worries unsettle global markets
The Nasdaq Composite fell 1.3% on Thursday, losing 345 points to close at 27,193.34. OpenAI reported annualized revenue approaching $50 billion, below the $70 billion figure previously circulated. Nvidia fell 2.9%, Broadcom lost 4.3%, and Micron dropped 4.8%. Firmus Grid, an Nvidia-backed Australian data-center operator, shelved its proposed $5 billion IPO. Oil prices remained high near $103.70 after a 4% surge on Thursday.
Micron vs Astera Labs: Two AI Chip Giants Expand Into Each Other's Territory
Micron reported fiscal Q4 revenue of $54.23 billion, up 379.3% year over year, with a gross margin of 87.0%. DRAM prices rose in the high-teens percentage range while data center SSD revenue neared $10 billion. Astera Labs reported revenue of $392.4 million, up 104.5% year over year, with PCIe 6 products making up over 50% of revenue. Micron has 26 strategic customer agreements backed by $32 billion in commitments, while Astera plans near-packaged optics chipsets for 2027 production. Micron trades at a forward P/E of 7 while Astera trades at 56.
Micron vs Astera Labs: Which AI Stock Is the Stronger Long-Term Bet
Micron's fiscal Q4 revenue hit $54.23 billion with a gross margin of 87.0%, driven by DRAM price increases in the high-teens percentage range. Astera Labs reported revenue of $392.4 million, up 104.5% year over year, and guided Q3 revenue to $540 million to $560 million. Micron has locked in 26 strategic customer agreements with $32 billion in commitments, with over 75% of calendar 2027 output already committed. Astera's Scorpio switches are expected to become its largest product family earlier than planned. Astera's stock dropped 9.21% on AI spending fears, compared to Micron's 4.79% drop, showing Astera is more sensitive to AI demand concerns.
AI Data Center Slowdown Would Hit Construction Workers and Banks Hard
Private companies were building data centers at a pace of roughly $85 billion annually in August, 73% more than a year earlier. Construction crews have been kept busy by data center work, with about 3,700 workers employed at a single Meta site in Richland Parish. AI-related spending added 1.3 percentage points to U.S. growth in early 2025 but less than half a point by the third quarter. Companies like Meta are spending nearly all their business revenue on AI, with long-term debt rising by about $25 billion in six months. Microsoft CFO Amy Hood said the company would slow chip purchases first if demand changed, leaving data center construction crews among the most vulnerable to job losses.
China Announces AI Safety Guidelines and New Innovation Centers
China will build technology monitoring, risk warning, and emergency response systems to ensure AI is safe, reliable, and controllable. The State Council Information Office said the country will establish a national AI innovation center focused on research and development. China will also create a national AI innovation and development zone to serve as a hub for AI-related industries. These efforts are part of China's broader push to promote high-tech industries and improve economic competitiveness through heavy investment in AI research, infrastructure, and the digital economy.
OpenAI Projects $20 Billion Revenue Jump Before Year End
OpenAI expects a $20 billion increase in annualized revenue before the end of 2026, driven mainly by growth in its enterprise business. The company shared these figures with investors during fundraising discussions. OpenAI declined to comment on the claims when approached by Bloomberg. Axios reported in September that OpenAI was on pace to generate significant revenue growth.
Marvell AI chip forecast sends CIEN and ALAB stocks soaring
Marvell held an Investor Day presentation on Thursday that predicted the AI chip market could reach $37 billion in revenue. Investors reacted positively to the bullish forecast. The shares of two connected companies, CIEN and ALAB, rallied significantly after the presentation. Both companies depend on a few major customers and have high valuations.
GCCI and partners offer free AI training for small businesses in Goa
The Goa Chamber of Commerce and Industry announced free AI training for small business and family enterprise owners. Ground Floor Labs, a US research and development lab, is partnering on the program. This follows a pilot conducted in June in Healdsburg, California. GCCI says AI adoption is critical for businesses to be future-ready.
Trump administration mandates AI companies report security incidents
The Trump administration now requires AI companies to notify and correct security incidents. This mandate follows an incident involving Anthropic. Companies must report security problems and take steps to fix them. The requirement was reported by Axios.
New method helps small vision-language models make better decisions
Researchers introduced Harness Compilation, an offline method that helps small vision-language models work with external tools. A large teacher model uses student execution traces to revise reusable content and control. The approach improves scores by 9.9 to 23.9 points across seven visual question-answering settings. Students of at most 9B parameters benefit from this allocation of work.
PwC Australia launches AI-powered cybersecurity service
PwC Australia launched Cyber Managed Services, an AI-enabled cybersecurity offering. The service provides 24-hour monitoring, threat detection, and incident response through a subscription model. AI agents collect information from cloud, identity, and application environments when suspicious activity is found. PwC cyber specialists then review the data and decide on the required response.
Sources
- Nasdaq futures rise after AI stocks' worst day since mid-August
- Nasdaq futures rise after AI stocks' worst session since August
- Nasdaq opens higher as oil retreats, AI stocks recover and telecom shares slide
- Nasdaq rises after OpenAI revenue report rattles AI stocks
- IXIC: Nasdaq Drops 1.3% as AI Worries Unsettle Global Markets. Has It Gone Too Far?
- Micron Vs. Astera Labs: Who Has Evolved Into The More Complete Next Gen AI Threat?
- Micron Vs. Astera Labs: Who Has Evolved Into The More Complete Next Gen AI Threat?
- If the AI data center boom ends, construction workers and banks will pay
- China issues guidelines for 'new productive forces' including AI
- OpenAI Projects $20 Billion Jump in Annualized Revenue Before Year End
- Marvell Says Connecting AI Chips Could Be a $37 Billion Business—These 2 Stocks Rallied Too
- GCCI, govt, 2 cos to offer free AI training for small biz owners
- Trump administration now mandating AI companies notify and correct security incidents, Axios reports
- Harness Compilation: Which Decisions Should a Small Vision-Language Model Keep?
- PwC Australia moves beyond advising with AI cybersecurity offering
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