AI Stocks Plunge as Top Lab CEOs Call for Development Slowdown

Asian markets opened sharply lower on Monday as investors absorbed weekend warnings from the leaders of the world's most advanced AI laboratories, who called for a deliberate slowdown in the pace of artificial intelligence development.

Anthropic CEO Dario Amodei urged AI companies to reduce the rate at which they advance model capabilities, citing mounting concerns about potential misuse. Both Elon Musk of xAI and Sam Altman of OpenAI publicly agreed with Amodei's position. Altman went further, announcing that OpenAI would not pursue an initial public offering this year due to safety concerns.

Market reaction across Asia

The statements triggered immediate selling pressure across AI-related equities. SoftBank, a major OpenAI investor, tumbled as much as 13.2% as Japanese trading began. Memory chipmaker Kioxia dropped 9.8%, while Tokyo Electron fell 3.7%.

In Taiwan, semiconductor giant TSMC slipped 1.2%. South Korean chipmakers faced steeper declines, with SK Hynix down 5.3% and Samsung Electronics falling 3.7%. Chinese stocks also retreated, with CXMT losing 2.7% and SMIC declining 1.4%. Hong Kong-listed AI companies saw similar pressure, including a 10.5% drop for Z.ai following a discounted share placement.

Why it matters

The coordinated warnings from AI industry leaders represent a significant shift in tone for an sector that has driven much of the global equity rally since ChatGPT's 2022 launch. The market's sharp reaction suggests investors are beginning to price in regulatory risk and potential development constraints that could slow the breakneck pace of AI advancement—and the revenue growth expectations built into current valuations.

Safety concerns escalate

The calls for restraint followed a threat intelligence report released Thursday by Anthropic detailing how actors had used its Claude AI models for weapons development, cyber operations, surveillance, and fraud. The alarm intensified when Anthropic researcher Jacob Coxon resigned, stating that those building AI "earnestly believe that it could kill us all by the end of the decade."

Altman characterized the risks of human extinction posed by AI as "unacceptable" in a recent interview.

The warnings have drawn mixed political responses. Several U.S. lawmakers have expressed concern about AI's rapid progress and called for new regulations. However, President Donald Trump on Sunday dismissed AI critics as "very negative forces" raising scenarios that won't materialize, emphasizing his priority to maintain U.S. industry leadership.

Broader industry headwinds

Beyond safety debates, the AI industry faces growing opposition from cyberattacks by rogue AI agents and public discontent over data center construction. The U.S. and Chinese governments are expected to hold AI safety discussions as part of bilateral talks scheduled for this month, according to sources briefed on the plans.

Takayuki Miyajima, senior economist at Sony Financial Group, noted that uncertainty surrounding Middle East tensions also contributed to negative market sentiment.

These details were first reported by Reuters.