The dot-com bubble burst in the early 2000s, causing a major technology-stock crash.
During the late 1990s, investors poured money into internet companies, often valuing businesses on expected future growth rather than profits. Many firms adopted internet-focused names or business plans and raised capital through initial public offerings. The Nasdaq Composite, heavily weighted toward technology companies, became the clearest symbol of the boom.
The bubble peaked in March 2000. The Nasdaq then fell sharply as investors questioned unrealistic valuations and the ability of many companies to earn revenue. By October 2002, the index had lost about 78% from its peak. Several prominent internet firms failed, while stronger technology companies survived and later became major businesses.
The dot-com crash is not the same as the 2008 financial crisis. The former centered on technology-stock valuations; the latter was closely tied to housing finance, credit markets, and banking failures.