IREN Ltd, a key player in the AI infrastructure space, saw its stock plummet 6.81% in after-hours trading on Thursday, extending losses from a volatile intraday session. This sharp decline comes as the broader AI sector experiences a significant selloff, despite initial optimism following Nvidia's strong earnings report.

The after-hours drop follows a turbulent day for IREN and other AI-related stocks. Initially, IREN's shares surged by 10% at market open, buoyed by Nvidia's record-breaking data-center revenue results. However, the enthusiasm was short-lived as the stock reversed course, ending the regular trading session down 5.04%. This rollercoaster ride reflects the larger trend in the AI sector, where initial gains fueled by Nvidia's positive outlook quickly evaporated.

Market analysts attribute the selloff to several factors. Despite Nvidia CEO Jensen Huang's optimistic projection of a $3-4 trillion addressable market for AI infrastructure by 2030, investors grew cautious as they digested new economic data. A stronger-than-expected jobs report lowered the probability of a December rate cut, sparking concerns that higher borrowing costs would disproportionately affect high-growth tech stocks. This macroeconomic backdrop, combined with profit-taking after the initial AI rally, has led to a broader reassessment of AI stock valuations, with IREN being particularly hard hit in the after-hours session.