Diverging Paths: GLP-1s Falter, AI Companies Thrive Amid Post-Pandemic Trades

GLP-1 drug makers and AI companies were the hot post-pandemic trades, but only one is thriving. GLP-1 makers, such as Novo Nordisk, are faltering after reporting disappointing revenue and profit forecasts. Meanwhile, AI companies like tech giants are posting impressive earnings and acting as a calming force amid economic uncertainty. The AI trade is proving resilient and unstoppable, while the GLP-1 trade is wavering, with companies like Hims & Hers Health reporting missed expectations.

In the post-pandemic era, GLP-1 drug makers and AI companies have been prominent investment themes. However, the resilience of these sectors has diverged significantly. While AI companies like Amazon and Marvell Technology have shown impressive earnings and growth, GLP-1 drug makers such as Novo Nordisk are facing challenges.

Novo Nordisk, a leading GLP-1 drug maker, reported disappointing revenue and profit forecasts in August 2025. The company warned on profits and replaced its CEO, which significantly impacted its market value. The Danish drugmaker is facing intense competition from rival Eli Lilly and copycat versions of its obesity drug, Wegovy. The company's sales outlook for the second half of 2025 has been lowered due to expected lower growth in its GLP-1 treatments [1].

Hims & Hers Health, another company offering compounded versions of GLP-1 drugs, also reported missed revenue expectations in the second quarter. The company's GLP-1 business, which markets compounded versions of semaglutide, saw a decline in revenue due to increasing legal and regulatory scrutiny. Novo Nordisk has initiated lawsuits against platforms selling these compounded versions, labeling such sales as unlawful and unsafe [2].

In contrast, AI companies have thrived. Amazon, a major player in AI, reported impressive earnings and growth in the first quarter of 2025. The company's extensive use of AI across its businesses, particularly in its cloud computing division, AWS, has driven its operating profits. Marvell Technology, another AI-focused company, also reported strong growth in its data center segment, driven by the increasing demand for AI-driven computing and cloud networking [3].

The AI trade has proven to be resilient and unstoppable, while the GLP-1 trade is wavering. Investors should carefully consider the business models and growth prospects of these companies before making investment decisions.

References:
[1] https://www.reuters.com/business/healthcare-pharmaceuticals/wegovy-maker-novo-nordisk-cut-costs-weight-loss-competition-heats-up-2025-08-06/
[2] https://ih.advfn.com/market-news/article/14055/hims-and-hers-shares-drop-after-revenue-falls-short-amid-glp-1-scrutiny
[3] https://www.mitrade.com/insights/news/live-news/article-8-1007298-20250802