The AI tech business isn’t over. Investors have recently chosen which players could become winners in 2026.
Tech ( XLK ) stocks have been on a rollercoaster lately as funding concerns for Oracle ( ORCL ) data centers and construction delays from CoreWeave ( CRWV ) shake up AI plays.
“I believe all of these are hyper-legitimate concerns for the subject, and as the market now breaks the ‘scrutiny scalpel’ we’re finally seeing a proper ‘winners and losers’ spread, and that’s a good thing,” Nomura Securities equity derivatives analyst Charlie McElligott wrote in a note on Thursday.
However, blockbuster results from Micron Technologies ( MU ) led to a rebound in AI trades. The memory chipmaker beat Wall Street estimates on Q1 revenue and EPS, helped by AI-fueled demand.
McElligott compared Micron’s “upside shock” to Nvidia’s ( NVDA ) May 2023 results, which served as a catalyst for the broader AI boom.
“Point by point, there’s still blood left in this AI stone,” McElligott wrote.
Investors are watching for potential funding risks within the AI trade after Oracle stock fell following a Financial Times report that Blue Owl Capital would not back Oracle’s $10 billion data center project.
The concerns are particularly notable given the market concentration among the largest tech companies in the S&P 500 (^GSPC).
Goldman Sachs analysts forecast the S&P 500’s earnings growth to exceed 12% in 2026, driven largely by the top seven stocks in the index. Those include Nvidia (NVDA), Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGL, GOOG), Amazon (AMZN), Broadcom (AVGO), and Meta (META). Together, they account for about a quarter of the index’s earnings.
Meanwhile, the “Magnificent 7” tech players are up an average of 21% this year, compared with a 16% gain for the S&P 500, according to Yahoo Finance data.
Tom Esse, founder of Sevens Report Research, told Yahoo Finance that he expects to see winners and losers within next year’s cohort.
Read more: How to protect your portfolio from the AI bubble
“I think we’re going to see some pretty big splits,” Ace said. “The next evolution of this business, where there will be winners and losers within Mag 7.”
He said his favorite stock is Alphabet because of the growth potential of Google’s Gemini artificial intelligence product.
“I think companies like Oracle that aren’t very financially stretched, but are kind of raising eyebrows with a lot of spending on AI, I think companies like that can struggle,” he added.
