What happened?

A number of stocks fell in the morning session after software stocks extended the selloff from the previous session as investors continued to reprice valuations amid mounting artificial intelligence capital expenditure concerns and decelerating software bookings. 

Oracle filed to raise $20 billion in debt and equity, reigniting concerns over soaring artificial intelligence spending and cash burn. The selloff deepened after quarterly reports from Alphabet and Amazon highlighted soaring data-center outlays that compressed free cash flows, as reported by Bloomberg. That spending concern triggered the tech-heavy Nasdaq's drop the previous week, cementing its steepest monthly decline in over a year, according to The Wall Street Journal. 

Investors are increasingly demanding clear evidence that massive infrastructure outlays will translate into sustainable profits and robust revenue growth. Without immediate monetization from enterprise adoption, concerns over elevated sector valuations have deepened, leading to broad-based selling pressure across chipmakers, hardware providers, and cloud service operators.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Content delivery company Cloudflare (NYSE: NET) fell 4.4%. Is now the time to buy Cloudflare? Access our full analysis report here, it’s free.
• Data storage company MongoDB (NASDAQ: MDB) fell 3.5%. Is now the time to buy MongoDB? Access our full analysis report here, it’s free.
• Cloud monitoring company Datadog (NASDAQ: DDOG) fell 4.4%. Is now the time to buy Datadog? Access our full analysis report here, it’s free.
• Developer operations company JFrog (NASDAQ: FROG) fell 5.7%. Is now the time to buy JFrog? Access our full analysis report here, it’s free.
• Data infrastructure company Elastic (NYSE: ESTC) fell 4.6%. Is now the time to buy Elastic? Access our full analysis report here, it’s free.

Zooming in on JFrog (FROG)

JFrog’s shares are extremely volatile and have had 45 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 3 days ago when the stock dropped 8.8% on the news that underwhelming earnings reports from tech giants Amazon and Intel (after mediocre earnings reports from Alphabet and ServiceNow the previous day) sparked widespread investor anxiety regarding aggressive artificial intelligence spending and sustained cash burn. As reported by CNBC, disappointing quarterly reports from both companies triggered a broad slide across technology equities and hardware suppliers, overshadowing positive momentum in other areas of the market. Investors grew increasingly wary of the sector's rising capital expenditures—the funds poured into long-term assets such as data centers and computing hardware. With both firms spending heavily to build out artificial intelligence infrastructure, market participants are questioning when these massive investments will translate into meaningful revenue and profit growth per CNBC. The steep drops in Amazon and Intel weighed heavily on market indices, showing how vulnerabilities among dominant technology leaders can rapidly dampen confidence across the broader industry.

JFrog is up 48.7% since the beginning of the year, but at $88.55 per share, it is still trading 14.9% below its 52-week high of $104.03 from August 2026. Investors who bought $1,000 worth of JFrog’s shares 5 years ago would now be looking at an investment worth $2,692.

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