AI downstream stocks tumble even as their picks and shovels peers soar

While the AI picks and shovels stocks are enjoying a strong start to 2026, the same can’t be said for the companies more downstream in this theme — even most of the hyperscalers.

The S&P 500’s biggest losers today include:

AppLovin, which is beloved by Wall Street for its heavy use of large language models to deploy code as well as its AI ad-targeting engine.
Cybersecurity companies CrowdStrike and Palo Alto Networks, which utilize AI tools to help combat increased AI-fueled vulnerabilities.
Other AI-linked software companies like Palantir, Adobe, ServiceNow, and Salesforce.
Among the hyperscalers, only Alphabet and Oracle are trading in the green on Friday, while Meta, Amazon, and Microsoft are all down between 1.5% and 2.5% as of 1:38 p.m. ET.

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Netflix sinks on lower-than-expected earnings forecast

Netflix’s report dropped on the same day it officially went all-cash in its bid for Warner Bros. Discovery.

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United Airlines rallies after Q4 earnings and Q1 profit guidance top estimates

Shares of United Airlines are rising after the bell on Tuesday, following the release of the carrier’s fourth-quarter and full-year earnings report.

United posted adjusted earnings per share of $3.10 in Q4, above the $2.92 per share expected by Wall Street analysts polled by Bloomberg. Sales of $15.4 billion were roughly in line with the consensus estimate.

The airline also:

Forecast full-year earnings per share between $12 and $14, bracketing Wall Street’s call for $13.04. For Q1, management sees EPS between $1.00 and $1.50, the midpoint of which is above the $1.16 expected by Wall Street.
Booked $13.93 billion in passenger revenue on the quarter, up nearly 5% year over year.

“Strong revenue momentum has continued into 2026,” according the company’s press release. “The week ending January 4th was the highest flown revenue week in United history, and the week ending January 11th was the highest ticketing week and the highest week for business sales in United history.”

UAL’s premium ticket revenue climbed 9% compared to a 7% increase in basic economy revenue. The “K-shaped economy” has become increasingly visible in travel trends at major US airlines. Last week, Delta’s revenue from first-class and business passengers eclipsed its main cabin revenue for the first time.

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And that means 3x the opportunities for gamma/pin risk in the largest US stocks (and the biggest bitcoin ETF).

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Drugmakers, which have spent the past six months reaching tariff deals with Trump, seem to expect some immunity from a new batch of tariffs on European countries.

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POET Technologies nears multiyear high on strong call demand after flagship product wins award

POET Technologies is surging on heavy volumes and high call demand after announcing that it won a Product Innovation Award at China’s Infostone awards.

The honor went to the optical communications company’s flagship product, the Teralight, which uses light to move data between chips.

“Unveiled less than a year ago at the 2025 OFC Conference, POET Teralight has driven commercial interest in the Company because of its highly integrated design and complete optical system-on-chip architecture that simplifies module development,” per the press release.

This award may be the latest excuse to buy the stock, which is up over 40% year to date.

Call activity is elevated, with nearly 37,000 having changed hands as of 10:55 a.m. ET, well above the 20-day average of 28,030 for a full session. Shares are approaching their multi-year high of $9.41.

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