Dot-Com Peak — March 10, 2000
The end of the internet bubble
The Nasdaq peaked at 5,048 on March 10, 2000 and fell 78% over 30 months. The S&P 500 fell 49%. Recovery to the Nasdaq high took 15 years (2015). This remains the longest recovery in tech history.
What history says
Editorial commentary written by ALAN analysts. Figures cited below are analyst-authored context — they are not derived from the chart above and may reflect different windows or sources.
At the peak, the Nasdaq traded at 175x trailing earnings. 80% of IPOs were unprofitable. Revenue multiples exceeded 100x for companies with no path to profitability.
Because the S&P 500 had lower exposure to speculative tech, its recovery (2007) was much faster. Diversification beyond tech was the key differentiator.
The 'Magnificent 7' of 2024 collectively earn $300B+ in annual free cash flow. The dot-com leaders (Cisco, Intel, WorldCom, Pets.com) generated a fraction of that. Valuation context matters.
Cap any single theme, however convincing, at a weight you could watch fall by three-quarters and take fifteen years to recover without derailing your plan; diversification beyond the era's favorite sector was what separated a 7-year recovery from a 15-year one.