Tom Lee: AI stock sell-off may be a mistake as demand stays strong

Fundstrat co-founder Tom Lee said on Nov. 2 that AI stocks are at or near a bottom after October's sell-off, arguing that demand remains strong and the market is not facing overcapacity. His call comes as six major tech firms represent about 26% of a typical S&P 500 fund. Lee dismissed concerns that AI businesses have built excess computing capacity, stating "the market for AI is still very tight" during a CNBC interview. Nvidia's fiscal second-quarter data-center revenue rose 117% year over year to $89 billion, with third-quarter revenue expected around $108 billion and results due Nov. 17. The average investor's exposure is significant, with Nvidia alone comprising 7.77% of State Street's SPYM fund as of Oct. 29. October marked the Nasdaq-100's weakest month since March 2025, falling roughly 7%, leaving investors to weigh whether selling after the drop risks missing a recovery or holding through further declines.