Magnificent Seven stocks are splitting as AI performance separates winners

The Magnificent Seven are coming apart, and artificial intelligence is the one driving the wedge. This group (Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia, and Tesla) dominated markets together for years.

But now, their stock performances are splitting, and the tech world’s AI obsession is exposing who’s actually delivering, and who’s just watching from the sidelines. According to The Wall Street Journal, these tech giants aren’t syncing up anymore, and some of them are quickly falling behind.

So far this year, Nvidia, Microsoft, and Meta stocks are up more than 20%, and Apple has dropped 16%, while Alphabet is down 2%, and Tesla is deep in the red at 18%, though all seven companies are still making up around 35% of the S&P 500, according to data from CNBC.

Bank of America’s Michael Hartnett, the guy who gave the group its “Magnificent Seven” label back in 2023, had a reason, as they were all pushing AI hard, but things have changed now.

Apple has not kept up, as its 2024 hyped-up launch of Apple Intelligence fell flat, updates to Siri are being delayed, and the company admits they might not be ready until late 2026.

Google’s Alphabet, meanwhile, is dealing with pressure from both regulators and competitors. It’s facing antitrust investigations in both the U.S. and Europe, and the rise of AI chatbots like ChatGPT is threatening its search empire. Alphabet has been rolling out features like Gemini and AI overviews on search pages. It has a deep pool of user data that could help train better models than competitors. But that hasn’t stopped skepticism.

Tesla is drifting for different reasons. Electric vehicle sales are slowing down, and Elon Musk is putting more attention on turning Tesla into something else entirely.

The company is moving toward robotics and artificial intelligence, and Elon recently said Tesla shareholders would vote on whether to invest in his other venture, xAI. Investors aren’t convinced. Tesla’s stock performance shows that this strategy hasn’t impressed Wall Street yet.

Dan Ives called it how he sees it: “In the Mag Seven, there’s the cool kids table—and Apple, Tesla, and Alphabet, they’re by the kitchen at the bad table, wishing they were at the cool kids table.”

Nvidia, Meta and Microsoft take the lead

Nvidia is leading the pack. Its stock has more than tripled in two years. It’s now the first company to hit a $4 trillion valuation, thanks to skyrocketing demand for its AI chips. Nvidia has basically outgrown the rest of the Magnificent Seven, moving in a completely different lane.

Meta and Microsoft aren’t far behind, as both now have a presence in AI and are being rewarded by investors.

Amazon, while not rallying quite like the others, still has its stock up 3% year to date, per data from CNBC. Tariff concerns have slowed things down for the Jeff Bezos-led company, but Amazon has invested in Anthropic, which helps its AI case a lot.

Now, everyone’s watching second-quarter earnings, with Alphabet and Tesla reporting later this week, and Meta, Microsoft, and Apple following shortly after.

Valuations are already sky-high. Six of the seven companies are trading above 25 times their projected earnings. By comparison, the S&P 500 average is 22.35. Alphabet is the only one priced below that.

Even with the performance gap widening, some investors think this split might not last. The companies lagging behind still have money, brand power, and plenty of time to course correct, or just buy their way back in.

But this wouldn’t be the first time a hyped group faded. FAANG (Facebook, Apple, Amazon, Netflix, and Google) once ruled Wall Street. That group collapsed in 2023.

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