The dot-com crash began after the technology-heavy Nasdaq Composite peaked in March 2000.
The Nasdaq Composite reached an intraday record of 5,132.52 on March 10, 2000. Investors had driven internet and technology shares to extraordinary valuations, often based on expectations of future growth rather than established profits. When confidence weakened, selling spread rapidly through the technology sector.
Many internet companies failed after they could not obtain additional funding or develop sustainable business models. The Nasdaq’s decline lasted for years, and the index did not regain its 2000 closing peak until 2015. Large technology companies also fell, although some established firms survived and later became much more valuable.
The dot-com crash is not identical to every technology-stock decline. It specifically refers to the collapse following the late-1990s internet investment boom. The episode also encouraged investors to pay closer attention to revenue, profits, cash flow, and realistic valuations.