Investors Shun Companies Seen as Vulnerable to AI Disruption

Investors are fleeing companies seen as most at risk from AI disruption, with shares of Wix.com, Shutterstock, and Adobe falling by at least 33% in 2025. Bank of America strategists identified these firms as vulnerable to AI disruption, while other companies like Duolingo have seen their stock double over the past year due to successful AI integration. The defensive moves by investors underscore the dominant role AI has played in determining winners and losers in the stock market this year.

Investors are increasingly cautious about companies deemed most vulnerable to AI disruption, with notable examples including Wix.com Ltd., Shutterstock Inc., and Adobe Inc. These firms have experienced significant share price declines, with Wix.com and Shutterstock down at least 33% and Adobe down 23% in 2025 [1]. The defensive moves by investors underscore the growing influence of AI in determining market winners and losers.

Bank of America strategists have identified a basket of 26 companies as most at risk from AI disruption, including the aforementioned firms. These companies have underperformed the S&P 500 Index by about 22 percentage points since mid-May, after initially keeping pace with the market since the debut of ChatGPT in late 2022 [1]. The concern is that AI applications could lead to falloffs in demand for their services, as seen in the case of Adobe, where clients may turn to AI platforms for image and video generation.

In contrast, companies that have successfully integrated AI into their strategies, such as Duolingo Inc., have seen their stock prices double over the past year. Duolingo's implementation of AI into its language-learning app has contributed to its strong performance [1].

The defensive moves by investors come as AI has emerged as a dominant theme in the stock market. Tech giants like Microsoft Corp. and Meta Platforms Inc. are pouring hundreds of billions into AI, with Microsoft and Meta alone expected to spend nearly $350 billion on AI infrastructure in their current fiscal years [1]. This investment is expected to benefit companies like Nvidia Corp., whose chips dominate the AI computing market.

However, the impact of AI on the stock market is not limited to just a few companies. Many traditional industries are facing disruption from AI, with companies like Gartner Inc. experiencing significant stock price declines after the company cut its revenue forecast for the year. Gartner's shares fell 30% in a single week, with analysts attributing the decline in part to concerns about AI providing cheaper alternatives to the company's research and analysis services [1].

The volatility in the stock market has not deterred investors from utilizing online brokers and other digital platforms for trading and portfolio management. Interactive Brokers Group, Inc. has reported robust growth in its July 2025 financial performance, with a 27% year-over-year increase in daily average revenue trades (DARTs) and a 35% year-over-year increase in ending client equity [2]. The company's success can be attributed to its technology-driven, low-cost platform that offers automated trade execution and custody across various asset classes.

In conclusion, the defensive moves by investors highlight the growing influence of AI in the stock market. While some companies are thriving due to successful AI integration, others are facing significant challenges. The volatility in the stock market has not deterred investors from adopting digital solutions for trading and portfolio management, as evidenced by the strong performance of online brokers and other digital platforms.

References:
[1] https://finance.yahoo.com/news/traders-fleeing-stocks-feared-under-130001182.html
[2] https://www.ainvest.com/news/volatility-stock-market-drives-online-broker-interest-2508/