The Dow Jones, which does not have a big tech concentration, fell 240 points from the highs of the day to end below the flat line, while the S&P 500 and Nasdaq saw losses of 0.5% and 0.9% respectively. At the lows of the day, the Nasdaq was down close to 1.5%.
A report from the Wall Street Journal stated that OpenAI, the start-up behind chatbot ChatGPT, has failed to meet its own internal user addition and sales targets in 2026 so far.
The report stated that OpenAI fell short of several monthly targets after Anthropic gained ground and that ChatGPT also failed to meet its 1 billion weekly active users target by end of 2025. Subscriber defection rate also remains a key challenge for the company as Google’s Gemini gains more popularity, according to the report. CFO Sarah Frier told internal leaders that if sales do not increase fast enough, OpenAI may not be able to afford future computing needs, the report stated.
In response, OpenAI brushed aside concerns, stating that the consumer and enterprise businesses are “firing on all cylinders” although it did not admit or deny the key part of the report of targets being missed. It added that it continues to see growth in demand from business customers and its advertising business, which currently is in its nascent stage.
However, stocks linked to OpenAI still tumbled lower on Tuesday, with shares of Oracle Corp. and Coreweave declining by 4% and 6% respectively. Shares of Nvidia and AMD fell 1.6% and 3.4% respectively, while SoftBank, a major backer in terms of funding, saw its stock fall 10% in Asian trading before the company issued its clarification.
The jitters among tech names will also be put to test today as four out of the Mag-7 names, Alphabet, Amazon, Meta and Microsoft, report their quarterly results after markets close. The other major trigger will be the outcome of the US Federal Reserve’s policy meeting. The market has factored in a 100% status quo probability in what could well be Jerome Powell’s last policy as Fed Chair.
Brent crude continues to trade around the $112 a barrel mark after the UAE announced on Tuesday evening that it will be quitting the OPEC alliance from May 1. US crude is also trading close to $100 a barrel.
