Tech stocks are leading the latest market downturn, just as they spearheaded the rally in 2023 and 2024. While the “Magnificent 7” stocks—Nvidia (NVDA), Tesla (TSLA), Alphabet (GOOG, GOOGL), Amazon (AMZN), Meta (META), Apple (AAPL), and Microsoft (MSFT)—have captured most of the attention, a broader group of high-growth tech stocks is also experiencing significant losses.

Tech Sell-Off Hits More Than Just the Magnificent 7

Stocks like Netflix (NFLX), AMD (AMD), Micron (MU), Dell (DELL), and Palantir (PLTR) have plunged amid the ongoing sell-off. Some saw a brief rebound on Wednesday, but Wall Street analysts warn of deeper volatility beneath the surface.

Mizuho analyst Jordan Klein described recent price action as “unwindy, but close to panic.” For example, Netflix stock has dropped 15% from its recent 52-week high, where it was trading above $1,000 per share.

Chip Stocks and Growth Plays Face Heavy Losses

The sell-off has been particularly brutal for chipmakers:

• AMD, Micron, Super Micro (SMCI), Intel (INTC), and ON Semiconductor (ON) have all fallen at least 40% from their respective 52-week highs, according to Yahoo Finance data.
• Palantir, once a momentum favorite, has sunk 30% since its record close on February 19.
• Dell shares have dropped nearly 50% from their peak.

Other high-growth tech names—including AppLovin (APP), Affirm (AFRM), Oklo (OKLO), and Reddit (RDDT)—have also seen declines between 30% and 50% over the past month.

What’s Driving the Tech Market Decline?

Several factors are fueling the downturn:

• Macroeconomic Uncertainty: Concerns over tariffs, political instability, and broader economic conditions are rattling investors.
• Fundamental Weaknesses: Some stocks are facing internal challenges. For instance, Palantir trades like a meme stock, with fears of U.S. government defense spending cuts impacting its valuation.
• AI Stock Fatigue: The artificial intelligence boom, which fueled massive gains in 2023 and 2024, is facing new skepticism. February’s DeepSeek sell-off raised concerns over AI’s long-term profitability, weighing on chip stocks.
• Earnings Disappointments: AMD delivered a solid Q4 earnings report but fell sharply after its data center growth outlook underwhelmed investors, highlighting potential slowdowns in AI chip demand.

Is a Market Shift Underway?

The “Magnificent 7” stocks, which drove a two-year bull market, are now down between 16% and 25% from their recent highs. Tesla has been hit the hardest, plunging nearly 50% from its record close in December.

Independent economist Peter Boockvar warns of a “regime change” in the stock market. With the Magnificent 7 making up 35% of the S&P 500 at their peak, their pullback leaves the broader market vulnerable unless new leadership emerges.

“What used to work is not going to work anymore,” Boockvar noted, emphasizing that the stock market historically shifts leadership when major sectors lose steam.

Where Does the Market Go from Here?

With all 11 S&P sectors in the red over the past month, it’s unclear which industries—if any—will take the lead next. Investors are watching for signals of stability, but for now, uncertainty continues to dominate the market.