Alphabet (GOOG<\/a>, GOOGL<\/a>) and Tesla (TSLA<\/a>) led the declines, falling 6% and 14%, respectively, following their quarterly results. Tesla alone lost roughly $200 billion in market value. <\/p>\n While Alphabet reported ballooning revenue<\/a> and a backlog for its cloud services, investors were spooked by increased capital expenditures on AI infrastructure and sold shares<\/a>. <\/p>\n “You’re in a major investment cycle and \u2026 people would rather invest in the companies, in the stocks that are receiving the investment dollars, rather than spending the investment dollars,” Evercore ISI senior managing director Mark Mahaney said. <\/p>\n Alphabet’s increase in capital expenditures highlighted how the “picks and shovels” players of the AI infrastructure trade will benefit from all that spending. While hyperscaler stocks sank, shares of memory chip makers Micron Technology (MU<\/a>), SK Hynix (SKHY<\/a>), and Sandisk (SNDK<\/a>) all jumped. <\/p>\n Electric vehicle maker Tesla also plans to spend heavily on AI<\/a> as it leans further toward autonomous robotaxis and robots, a task that still has a ways to go. <\/p>\n Northwestern Mutual Wealth Management Company chief investment officer Brent Schutte told Yahoo Finance that investors should diversify into less expensive stocks. <\/p>\n “[Investors] should be looking at actual earnings and paying for those that aren’t dependent upon what’s way out in the future, that may or may not actually happen, and I think that’s always been the story of Tesla,” he said. <\/p>\n Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre<\/a>. <\/p>\n Click here for the latest technology news that will impact the stock market<\/a> <\/p>\n Read the latest financial and business news from Yahoo Finance<\/a> <\/p>\n <\/a> AlphaSpace heatmap showing declines in “Magnificent Seven” stocks. <\/p>\n