Meta Platforms (META) shares fell 7% overnight, dragging the Nasdaq Composite down 2.6% and the S&P 500 by 1.2% on Thursday, Oct. 22. The drop followed the company’s earnings report, which highlighted a negative free‑cash‑flow and a new capital‑expenditure plan of ₹825 bn—up ₹125 bn from the July announcement.
The earnings miss sent ripple effects across the tech sector. Nvidia, Amazon, Microsoft and Alphabet collectively shed nearly ₹800 bn in market cap, while Apple and Netflix bucked the trend, posting modest gains. Memory‑chip makers were hit hardest: AMD, Intel and SK Hynix ADRs slid 8% each; Micron, Western Digital and SanDisk fell between 6% and 8%. Western Digital, despite beating EPS forecasts and raising its quarterly dividend by 17%, still fell 5% in extended trading.
Meta’s credit risk spiked to a record high overnight as bond yields weakened, reflecting investors’ concerns over its projected cash‑flow trajectory. The company’s CFO said in the earnings call that the higher spend would be financed through a mix of debt and equity, but the market responded with a sharp sell‑off.
Nvidia CEO Jensen Huang warned on CNBC that capital constraints are stalling growth in the neocloud segment, even as demand remains “off the charts.” Meanwhile, Brent crude surged above $113 a barrel after Houthi attacks on Saudi Aramco facilities, adding further volatility to the equity markets.
Bond yields reflected the flight to safety: the U.S. 10‑year fell below 5% for the first time in over a month, with some tenors dropping more than 20 basis points. Analysts expect no new guidance from Meta or its peers this quarter; the market is likely to stay in a cautious mode as investors weigh AI spending and oil‑price dynamics.