Most of the Magnificent-7 US stocks- Apple, Microsoft, Google parent Alphabet, Amazon.com, Nvidia, Meta Platforms, and Tesla- took drops on Monday. Throughout 2025 thus far, the Mag-7 group has largely underperformed. This is especially rough considering the solid 2024 each of those stocks had.
Here’s how each of the mag-7 stocks performed during Monday’s trading session.
- Apple (AAPL)- +1.94%
- Microsoft (MSFT)- -0.90%
- Alphabet (GOOGL)- +0.20%
- Amazon (AMZN)- -1.28%
- Nvidia (NVDA)- -1.18%
- Meta Platforms (META)- -0.07%
- Tesla (TSLA)- -1.67%
Why Magnificent-7 Stocks Fell
Although President Donald Trump’s tariff policies don’t directly impact some of the Magnificent 7, the shift in investor sentiment comes from the economic uncertainty that these tariffs create. Tesla is widely expected to be affected the least by these tariffs, but even the EV giant will see some impact.
Furthermore, there are also concerns that the strong earnings growth between 2023 and 2024 will slow as large tech companies spend more on AI. The wave of artificial intelligence is growing as more companies invest millions into developing within that sector. Amazon, Microsoft, Nvidia, and Apple are four of the top investors in AI among the Mag-7 group. While these investments create opportunities down the line, the short-term effect could mean less net revenue from these giants.
Also Read: Amazon (AMZN): Why Warren Buffet Thinks Stock Could Double
This decrease in revenue is being seen between Q4 2024 and Q1 2025 for these companies. While most Q4 earnings reports beat expectations, these companies also gave lackluster guidance for Q1 2025 and beyond, likely due to how much the companies are putting back into AI development. The combination of dumping all revenue into AI and looming tariff threats creates more certainty around magnificent-7 stocks. Thus, investors may look to jump into smaller-market-cap companies that could still promise gains.