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The Magnificent Seven Stocks Are Splitting Apart as AI Performance Divides Winners from Losers

The Magnificent Seven Stocks Are Splitting Apart as AI Performance Divides Winners from Losers

Author:
D3V1L
Published:
2025-07-20 20:11:02
10
3


The "Magnificent Seven" tech giants—Nvidia, Microsoft, Meta, Apple, Alphabet, Tesla, and Amazon—are no longer moving in lockstep. While Nvidia, Meta, and Microsoft surge ahead with AI-driven gains, Apple, Alphabet, and Tesla lag behind due to strategic missteps and external pressures. This article breaks down their diverging performances, analyzes key drivers, and explores whether the underdogs can catch up. Buckle up for a deep dive into Wall Street’s hottest tech drama.

Why Are the Magnificent Seven Stocks Diverging?

Remember when the Magnificent Seven—coined by Bank of America’s Michael Hartnett in 2023—were the darlings of Wall Street? Fast forward to mid-2025, and the group’s unity has shattered. Nvidia, Meta, and Microsoft have soared over 20% year-to-date, while Apple plunged 16%, Tesla dropped 18%, and Alphabet dipped 2%. Even Amazon, the quiet middle child, managed a modest 3% gain. The culprit? AI execution. As Dan Ives of Wedbush quipped, "There’s the cool kids’ table (Nvidia, Meta, Microsoft), and then there’s the kitchen misfits (Apple, Tesla, Alphabet) staring longingly at the VIP section."

Nvidia, Meta, and Microsoft: The AI Power Trio

Nvidia isn’t just leading—it’s lapping the competition. Its stock tripled in two years, hitting a historic $4 trillion valuation thanks to insatiable demand for its AI chips. Microsoft, meanwhile, turned its OpenAI partnership into a $300 billion AI empire, while Meta’s Llama 3 and ad-targeting upgrades silenced doubters. "These three aren’t just riding the AI wave—they’re the wave," notes BTCC analyst Clara Wu. Together, they account for 60% of the group’s $12 trillion collective market cap.

Apple’s AI Stumbles: Siri’s Slow Motion Crisis

Apple’s "Apple Intelligence" launch fizzled harder than a Touch Bar MacBook. With Siri upgrades delayed until 2026 and no killer AI hardware, even die-hard fans are questioning Tim Cook’s strategy. The stock’s 16% drop reflects fears Apple’s playing catch-up in a race it used to lead. As one hedge fund manager told CNBC: "They’ve got the cash to buy their way back in, but right now, it’s like watching Michael Jordan miss free throws."

Alphabet and Tesla: Regulatory Storms and Identity Crises

Alphabet’s Gemini AI can write poetry but can’t escape antitrust probes in the US and EU. Meanwhile, Tesla’s "are we a car company or an AI robotics startup?" identity crisis has investors spooked. With EV sales slowing and Musk diverting attention to XAI, Tesla’s 18% drop suggests Wall Street wants fewer tweets and more Model 2s. "Tesla’s valuation assumes AI miracles," warns TradingView data. "But miracles don’t ship on quarterly earnings calls."

Can the Laggards Bounce Back?

History says maybe. During the 2023 FAANG collapse, Netflix and Amazon rebounded by doubling down on cloud and content. Apple still has $200 billion in cash, Alphabet dominates search ad revenue, and Tesla’s Optimus robot could be a sleeper hit. But with six of the seven trading above 25x earnings (vs. S&P 500’s 22.35), patience is thinning. As Q2 earnings roll out this week, all eyes are on who’s got real AI muscle—and who’s just flexing.

FAQ: Your Magnificent Seven Questions Answered

Which Magnificent Seven stocks are outperforming in 2025?

Nvidia (+210% YTD), Meta (+45%), and Microsoft (+38%) lead the pack, per CNBC data as of July 2025.

Why is Apple stock falling?

Delayed AI features, weak iPhone 16 demand in China, and no major acquisitions have pushed Apple down 16%.

Is Tesla still part of the Magnificent Seven?

Yes, but barely. Its 18% drop and erratic strategy have some suggesting Broadcom or ASML might replace it.

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