The AI trade is already splitting into two very different lanes in early 2026.
While the picks-and-shovels side of AI like chips, memory, and infrastructure is off to a strong start, the companies that actually use AI to sell software, ads, or services are getting hit.
That divergence is showing up clearly in today’s S&P 500 movers.
The software side feels the pain
Some of the biggest AI-linked losers today are companies that sit further downstream in the AI value chain.
$APP ( ▼ 8.24% ) AppLovin is sliding after a huge 2025 run, despite its heavy use of large language models for ad targeting and code deployment. Cybersecurity names $CRWD ( ▼ 3.24% ) CrowdStrike and $PANW ( ▼ 2.62% ) Palo Alto Networks are also lower, even though AI-driven threats are a core part of their long-term bull case.
Other AI-exposed software stocks are seeing similar pressure. $PLTR ( ▼ 5.56% ) Palantir, $ADBE ( ▼ 4.77% ) Adobe, $NOW ( ▼ 3.75% ) ServiceNow, and $CRM ( ▼ 4.26% ) Salesforce are all down sharply, signaling that investors are rotating away from AI applications and monetization stories, at least for now.
Even hyperscalers are not immune
The weakness is not limited to software.
Among the hyperscalers, only $GOOGL ( ▲ 0.69% ) Alphabet and $ORCL ( ▲ 0.41% ) Oracle are trading higher. $META ( ▼ 1.47% ) Meta, $AMZN ( ▼ 1.87% ) Amazon, and $MSFT ( ▼ 2.21% ) Microsoft are all down between roughly 1.5% and 2.5% midday, despite being central players in AI spending and deployment.
That matters because these companies are supposed to be the bridge between massive AI capex and real-world revenue growth.
Follow the money, not the buzz
The takeaway is simple.
Traders are still happy to buy AI infrastructure where demand is visible, margins are expanding, and orders are locked in. But when it comes to downstream AI adoption, monetization, and software execution, patience is thinning.
If this is still an AI bull market, it is increasingly one that rewards certainty over storytelling.