markets

8/20/25

Adding “AI” to your company’s name was a blessing. Right now it’s a curse.

There’s no better way to make sure everyone knows you’re in the AI business than literally putting it in your name, a tactic many US publicly traded companies have turned to to try to ensure their stocks get their fair share of any halo effect from the theme.

But when there’s a nascent pullback in everything AI, that also means you stick out like a sore thumb.

We scanned the S&P 500 Total Market Index for companies whose names make it very clear they’re in the artificial intelligence business (mostly relatively smaller stocks).

But following BigBear.ai and C3.ai’s tumbles in the wake of brutal earnings reports earlier this month, the selling in speculative and AI stocks has intensified over the past two sessions. The average stock in the below chart is down 8.7% over the past two sessions, while a Bank of America basket of mostly large-cap US AI beneficiaries has dropped about 7% over the same period.

SoundHound AI is at the bottom of the pack despite a dearth of company-specific news.

There is one exception to this rule: Gaxos.ai, omitted from the above chart. The stock went bonkers on Tuesday after launching a new AI image and video platform, but is giving back some of those gains today.

More Markets

See all Markets

Nia Warfield, Luke Kawa

S&P 500 closes at record as tech heavyweights flex (besides Apple)

The Magnificent 7 did the heavy lifting, performing better than any S&P 500 sector ETF on Tuesday.

Bull by the horns

markets

11h

Oracle rips as backlog builds, but company misses on top and bottom lines

Oracle shares shot higher after-hours as the company reported a growing backlog, even though its fiscal Q1 results fell slightly short of expectations. The company reported:

Adjusted earnings per share of $1.47 vs. expectations of $1.48.
Revenue of $14.93 billion vs. expectations of $15.04 billion.

Shares were up 21% in after-hours trading, which is a pretty crazy stock move for a company with a market cap of more than $675 billion.

The market was likely impressed by a giant build in the company’s “remaining performance obligations,” or RPO, which is how the company measures the value of signed cloud computing deals that haven’t yet been reported as revenue. In a statement, CEO Safra Catz said:

“We signed four multi-billion-dollar contracts with three different customers in Q1. This resulted in RPO contract backlog increasing 359% to $455 billion. It was an astonishing quarter — and demand for Oracle Cloud Infrastructure continues to build. Over the next few months, we expect to sign-up several additional multi-billion-dollar customers and RPO is likely to exceed half-a-trillion dollars.”

Oracle Announces Fiscal Year 2026 First Quarter Financial Results

Oracle Announces Fiscal Year 2026 First Quarter Financial Results

The market was likely impressed by a giant build in the company’s “remaining performance obligations,” or RPO, which is how the company measures the value of signed cloud computing deals that haven’t yet been reported as revenue. In a statement, CEO Safra Catz said:

“We signed four multi-billion-dollar contracts with three different customers in Q1. This resulted in RPO contract backlog increasing 359% to $455 billion. It was an astonishing quarter — and demand for Oracle Cloud Infrastructure continues to build. Over the next few months, we expect to sign-up several additional multi-billion-dollar customers and RPO is likely to exceed half-a-trillion dollars.”

markets

12h

Robinhood rides index inclusion rally to record close

Robinhood Markets notched a new closing high Tuesday, as the crypto, stock, and options brokerage continued to ride a rally set off by the announcement that it would be added to the S&P 500 Index.

(Robinhood Markets Inc. is the parent company of Sherwood Media, an independently operated media company subject to certain legal and regulatory restrictions.)

Robinhood appears to be benefiting from the so-called inclusion effect, a market phenomenon where companies that are added to major market indexes can see a price move as index funds — whose holdings must mirror the membership of the index — rush to buy the stock.

For what it’s worth, it seems like Robinhood will upon entry (effective prior to the market open on September 22) be the top-performing member of the index, as its roughly 220% gain this year is more or less double that of the current leader, Seagate Technology Holdings.

markets

12h

GameStop posts impressive Q2 results with big sales beat

Don’t call it a comeback!

GameStop is jumping aftermarket as the video games and collectibles retailer posted an impressive set of second-quarter results.

Net sales: $972 million (estimate $823 million).
Adjusted diluted earnings per share: $0.25 (estimate $0.16).

Note: these consensus estimates, compiled by Bloomberg, are from only two analysts.

The sales beat is particularly noteworthy, as the company had already done an exemplary job of expense control to help protect its bottom line. Revenues were up more than 20% versus the year-ago quarter, the biggest annual jump in sales since the company (and the world) was emerging from the pandemic in 2021.

The options market implies a move of plus or minus about 9.4% on earnings.

For a while, GameStop’s ability to generate positive net income was purely a function of the interest earnings on its substantial cash hoard. But now, GameStop has strung together five consecutive quarters of positive operating cash flows for the first time in its history!

This was the quarter when the company began to act on its bitcoin treasury strategy, raising money through the sale of convertible notes and using some proceeds to purchase the crypto asset.

Because of how much market value has been ascribed to potential for GameStop CEO Ryan Cohen to use its significant cash holdings to transform the company, the prospect of converting cash into bitcoin initially did not sit too well with investors following the announcement of this new strategic push in March.

Shares of the once-upon-a-time meme stock really didn’t get too much love during retail frenzies earlier in the summer, and were down about 25% year to date heading into this release.

As of the close of the quarter, its bitcoin holdings were valued at $528.6 million.

Western Digital Seagate Technology Rise to top of S&P 500

Data storage is so hot right now

A rapid turnaround in profitability helps explain how Seagate Technology and Western Digital have clawed to the top of the S&P 500 this year.

Matt Phillips14h

Latest Stories

Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate, including Robinhood Markets, Inc., Robinhood Financial LLC, Robinhood Securities, LLC, Robinhood Crypto, LLC, or Robinhood Money, LLC.

©2025 Sherwood Media, LLC