Wall Street’s Magnificent Seven is losing its hold as AI trade expands beyond Big Tech

Wall Street is rethinking its favorite collection of stocks. Big Tech, a.k.a. the Magnificent Seven (Nvidia, Microsoft, Apple, Alphabet, Amazon, Meta, and Tesla), once defined the AI boom, but the trade is spreading further.

Since ChatGPT placed AI at the center of the global economy around three years ago, investors have gone crazy pouring money into Big Tech, making it responsible for more than half of the S&P 500’s 70% surge since 2023, according to data from Bloomberg.

Now the gains are moving beyond Big Tech, and strategies built only around the seven giants risk missing the next winners.

The group is still massive. The Mag 7 controls almost 35% of the S&P 500, with earnings projected to rise more than 15% in 2026 and revenue up 13%. The rest of the index is expected to post 13% earnings growth and just 5.5% in revenue.

But performance inside the seven tells two different stories. Nvidia, Microsoft, Alphabet, and Meta are up between 21% and 33% this year. Apple, Amazon, and Tesla are trailing, their roles in an AI-driven market far less certain.

Analysts add new companies to the trade

Some on Wall Street are cutting the list down. A “Fab Four” of Nvidia, Microsoft, Meta, and Amazon has been suggested. Jonathan Golub at Seaport Research recommended removing Tesla to create a “Big Six.” Ben Reitzes at Melius Research added Broadcom to make an “Elite 8.”

But none of these attempts capture all the companies benefiting from AI.

Oracle has surged more than 75% in 2025 as its AI-related cloud services took off. Palantir, once a niche software firm, is now the top performer in the Nasdaq 100, surging 135% this year on AI demand. Jurrien Timmer, director of global macro at Fidelity Investments, which oversees $16.4 trillion, said:

“A company can become too big to ignore. It could be that as the AI story evolves, new winners take the place of the old winners, even if the previous ones continue to do fine.”

This is not the first time Wall Street has reshuffled the names that dominate. The Nifty Fifty ruled the 1960s, the Four Horsemen carried the Nasdaq through the dot-com bubble, and FAANG defined the mobile and social media era.

Each club was dominant for its time, but each eventually gave way to new leaders. The same pattern is now playing out with AI.

Index makers formalize the expansion

Cboe Global Markets announced the Magnificent 10 Index on September 10, including the original seven plus Broadcom, Palantir, and Advanced Micro Devices. The announcement came the same day Oracle posted its biggest one-day gain since 1992 with a strong forecast, yet it was excluded.

Nick Schommer, portfolio manager at Janus Henderson, which manages $34.7 billion, said: “We do need to expand the conversation beyond just the Mag Seven. Oracle is definitely a part of it now, and so is Broadcom.”

Cboe said the index was built on criteria like liquidity, market value, trading volume, and leadership in artificial intelligence and digital transformation.

Taiwan Semiconductor Manufacturing, Oracle, Broadcom, and Palantir are repeatedly mentioned by investors as critical to the AI ecosystem. Palantir is also singled out as one of the few clear software winners while firms like Salesforce and Adobe face doubts about being left behind.

The AI boom is lifting companies outside the seven. Apple is flagged as falling behind in AI, while Tesla faces a crowded electric vehicle market. Still, both have loyal investors. Apple supporters believe the iPhone will become the gateway device for AI. Tesla’s backers place their hopes on Elon Musk’s push into autonomous driving and humanoid robots.

AI demand is boosting energy producers, networking companies like Arista Networks, memory makers such as Micron, and storage firms including Western Digital, Seagate, and SanDisk. But not all players are available on the market.

OpenAI, reportedly valued at $500 billion, remains private, as do Anthropic and SpaceX, though they still shape the AI environment.

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