Magnificent Seven Stocks Tumble As Amazon, Apple, Meta, Nvidia, Tesla Sell Off

Ladies and gentlemen, buckle up! The Magnificent Seven stocks—Apple, Microsoft, Google parent Alphabet, Amazon.com, Nvidia, Meta Platforms, and Tesla—have taken a nosedive in 2025. These tech giants, which dominated the market in 2024, are now facing a brutal sell-off. Let's dive into the chaos and figure out what's going on!

First, let's talk about the elephant in the room: the DeepSeek breakthrough. This AI platform has put a spotlight on the ever-rising capital outlays of the Magnificent Seven. Investors are getting nervous about the high spending on AI initiatives, and it's showing in the stock prices. The market hates uncertainty, and right now, there's plenty of it.



Now, let's break down the performance of each stock. Meta Platforms (META) is the only one in positive territory, outperforming the S&P 500 index. But Tesla (TSLA)? Oh boy, Tesla is at the bottom, having lost roughly a third of its value. Ouch! The rest of the group is somewhere in the middle, with Nvidia (NVDA) and Alphabet (GOOGL) positioned toward the bottom, while Microsoft (MSFT), Amazon (AMZN), and Apple (AAPL) are in the top half.

Why the sell-off? Well, Tesla's underperformance can be blamed on its China exposure, trade/tariff vulnerabilities, and the evolving EV competitive landscape. Apple, another member of the group, has significant exposure to both China and the trade/tariff issue. And let's not forget about the AI theme. All stocks related to this broad AI theme have been under a cloud lately, and these AI leaders are particularly vulnerable to this development given their heavy spending on the effort.

Now, let's talk about the earnings outlook. For 2025 Q1, the expectation is that Mag 7 earnings will increase +13.1% on +11.9% higher revenues. This would follow the group’s +31% earnings growth on +12.8% revenue growth in the preceding period. But here's the kicker: the outlook is a lot less positive than it was in the recent past. The levelling out of the revisions trend reflects how estimates for Tesla, Apple, and Meta have been unfolding in recent days, with the outlook for the rest of the group still very much positive.



So, what do you do now? Well, if you're holding onto these stocks, you might want to consider cutting your losses. But if you're looking to buy, now might be the time to scoop up some bargains. Just remember, the market is unpredictable, and these stocks could bounce back just as quickly as they fell.

In conclusion, the Magnificent Seven stocks have taken a beating in 2025. The DeepSeek breakthrough, mixed performance among individual stocks, and a shift in sentiment towards the AI theme have all contributed to the sell-off. But remember, the market is a fickle beast, and what goes down must come up. So, stay tuned, and keep your eyes on the prize!