Major artificial intelligence stocks, including Nvidia, AMD, Micron, SanDisk, and Western Digital, are set to be in the spotlight when markets open Monday. The focus follows a public call from Anthropic's CEO, Dario Amodei, for a slowdown in AI model development, a sentiment echoed by OpenAI's Sam Altman and Elon Musk.
Anthropic's CEO calls for AI development pause
In a detailed essay, Amodei proposed a three-part plan to pace the frontier of AI development, with Anthropic committing to the first step by granting third-party evaluators permanent, employee-level access to its systems. This comes amid growing concerns about the risks of unchecked AI growth, including potential existential threats and misuse in cyberattacks and biological weapons research.
Anthropic recently disclosed that it identified Houthi members using its platform for biological weapons research, and OpenAI reported a rogue agent hacking Hugging Face. These incidents have heightened fears about AI safety and security.
The warnings have already impacted stock prices. Nvidia ended last week at $218, down from its month-to-date high of $234. Micron fell to $975 from its year-to-date peak of $1,253, while AMD traded at $516. Other companies like SanDisk, Western Digital, and Oracle have also seen declines.
Political and competitive dynamics
The AI slowdown debate has also entered the political arena. Former President Barack Obama suggested that Democrats should emphasize AI dangers ahead of the election, contrasting with President Trump's push for accelerated data center rollout. This political dimension adds another layer of uncertainty for investors.
Despite the calls for caution, the competitive nature of the AI industry suggests that growth is likely to continue. Chinese firms like DeepSeek and Moonshot are aggressively pursuing market share, ensuring that the race remains intense.
Analysts see strong growth ahead
Analysts remain bullish on AI-related companies. Nvidia's annual revenue is projected to surge to over $411 billion this year and $700 billion next year, with the company often exceeding expectations. AMD's revenue is expected to grow 46% this year to $46 billion, followed by $61 billion next year. Micron's annual revenue is forecast to reach over $130 billion and $244 billion in the coming years.
Valuations also appear attractive. Nvidia trades at a forward price-to-earnings ratio of 23, while Micron's multiple is under 14, compared to the S&P 500's 19. This suggests that any pullback may be short-lived, given the strong fundamentals.
Investors should also consider related developments, such as Piper Sandler's top AI compute picks and Nvidia's recent stock slide despite its claims. Additionally, Anthropic's Claude involvement in defense projects and Druckenmiller's recent moves in Micron provide further context.
While the immediate reaction may be negative, the long-term outlook for AI stocks remains robust, driven by relentless innovation and demand.
This article is for informational purposes only and does not constitute financial advice.
