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By Emily Bary

Apple has been seen as an AI loser. That means its stock hasn’t gotten caught up in the heavy selling pressure on AI stocks.

Apple has been able to drive strong iPhone upgrades from people looking to replace much older devices.

What was once the biggest knock against Apple’s stock is now proving to be a positive as tech shares come under pressure.

Not only has Apple’s stock (AAPL) beaten the tech-heavy Nasdaq Composite Index COMP since the start of November, but it’s outperformed the more broad-based S&P 500 SPX as well. That partly owes to the fact that AI plays have been hard hit in recent sessions, but Apple isn’t seen as an AI stock.

“Apple shares have shown resilience compared to their mega-cap peers as they have significantly less exposure to the AI cycle,” D.A. Davidson analyst Gil Luria told MarketWatch in emailed comments.

Microsoft’s stock (MSFT) is getting close to joining Nvidia (NVDA), Amazon.com (AMZN) and Tesla (TSLA) shares in correction territory, which is defined as a 10% drop or more off a recent closing high. And Meta’s stock (META) is already in a bear market, meaning it’s off more than 20% from its recent closing high. But Apple and Alphabet (GOOG) (GOOGL) shares stand out, down less than 3% from their recent highs.

See more: Two more ‘Magnificent Seven’ stocks are now in correction territory as the AI trade unwinds

While people use their iPhones to access AI tools, “the current iPhone upgrade cycle is showing that [Apple] does not need AI in order to drive demand,” Luria continued. “An aging iPhone base is translating to the best upgrade cycle in years, which is helping deliver the current resilience.”

Apple has vastly underspent its Big Tech peers on its artificial-intelligence buildout, opting for more of a hybrid approach to data centers. FactSet data indicates Amazon spent approximately 10 times as much on capital expenditures in the September quarter than Apple did.

The iPhone maker’s more measured approach to AI spending has largely been perceived as a negative by Wall Street up until this point. Apple has been branded an AI laggard, and indeed the company has struggled to roll out the AI features it has teased. But now the market is getting more jittery about fellow tech giants’ rampant data-center spending, which has in some cases prompted debt financing despite uncertainties around the returns on these investments.

More from MarketWatch: Amazon and Microsoft shares could be in trouble due to AI’s destructive economics

Apple shares now rank in the middle of the pack among “Magnificent Seven” players this year. Up about 7%, they dramatically lag Alphabet shares, which are the group’s leader. But they’ve now beaten out shares of Meta, for instance, which have been dogged recently by concerns about AI overspending.

Jeffrey Favuzza, a tech, media and telecommunications strategist at Jefferies, said Apple’s recent outperformance has more to do with the fact that investors have underweighed the stock relative to others in the group.

There are still numerous questions facing Apple investors, he said, including whether a foldable phone will materialize and be a big driver of upgrades. Investors are also left to wonder who will succeed CEO Tim Cook, after the Financial Times recently reported that he may step down as soon as next year.

Plus, there’s been somewhat of a “brain drain” from Apple’s AI ecosystem, Favuzza added. And while Apple isn’t spending nearly as much as rivals on AI, its operating expenses moved higher in the latest quarter, casting some doubt around future earnings trends.

Don’t miss: Nvidia earnings have become crucial to the stock market – and this time even more so

-Emily Bary

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

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  11-18-25 1754ET
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Hewlett Packard (HP) is seeking $1.7bn (£1.3bn) from the estate of Mike Lynch – who died last year when his yacht sank – over HP’s acquisition of his firm Autonomy, the tech giant’s lawyers have told the High Court.

HP, now known as Hewlett-Packard Enterprise (HPE), bought Mr Lynch’s tech firm Autonomy in 2011, but it says Mr Lynch and Autonomy’s former chief financial officer, Sushovan Hussain, misrepresented the company’s finances.

In a 2019 trial, HPE had accused Mr Lynch of inflating Autonomy’s revenues which it said forced it to announce an $8.8bn write-down of the company’s worth.

Mr Justice Hildyard ruled in 2022 that HPE had “substantially succeeded” in its claim, but that it was likely to receive “substantially less” than the $5bn it sought in damages.

Earlier this year, he ruled that HPE suffered losses amounting to around £700m through the purchase of Autonomy.

Mr Lynch and his teenage daughter Hannah were among seven passengers and crew who died when the Bayesian went down off the coast of Sicily last August during a storm which caused the vessel to capsize and sink.

A hearing in London, which began on Tuesday, will now decide whether Mr Lynch’s estate can appeal against the 2022 and 2025 rulings.

In written submissions, Patrick Goodall, the barrister representing HPE, argued that Mr Lynch’s estate was liable to pay $1.7bn, which includes around $761m in interest.

He said that Mr Lynch had “not only perpetrated an enormous fraud, but lied about it at every stage”.

He said the claimants had spent almost £150m on the legal battle, and were seeking nearly £113m of their costs from Mr Lynch’s estate.

Mr Goodall also said that Mr Lynch’s estate should not be allowed to appeal against either the 2022 or 2025 rulings.

In written submissions, Richard Hill, the lawyer representing Mr Lynch’s estate, said that the $761m in interest sought by the claimants was an “excessive sum… based on a flawed analysis” and that the “legally and economically rational approach would provide for a materially lower figure”.

The claimants’ position that “they were the victors in this litigation” was “overly simplistic”, he added.

Mr Hill also said that Mr Lynch’s estate should be allowed to appeal against the two earlier rulings, claiming that the judge “erred in law” and that there was a “compelling reason for allowing the appeal to be heard”.

A spokesperson for the Lynch family said: “Today’s hearing addresses technical matters that change nothing about the underlying substance of the case.

“The core facts remain that HP’s claim was fundamentally flawed and a wild overstatement.”

In a separate case, Mr Lynch was extradited to the US in 2023 to face criminal charges, and he was cleared of fraud charges in 2024.

He was celebrating being acquitted on his yacht when it sank.

(Bloomberg) — Asian stocks were mainly set for a positive open, even as Wall Street’s selloff deepened amid mounting concerns over lofty valuations in the artificial intelligence sector.

Equity-index futures pointed to gains in Japan and Hong Kong following three days of losses for both benchmarks, and a small decline for Australia. The S&P 500 index fell for a fourth day, the longest losing streak since August. A basket of the Magnificent Seven companies declined 1.8%. Nvidia Corp., at the center of the AI frenzy, slumped 2.8% ahead of its earnings report after Wednesday’s close.

Bitcoin climbed after briefly dropping below $90,000. The yield on 10-year Treasuries slid three basis points to 4.11%. The dollar wavered.

Wall Street has grown increasingly concerned that AI isn’t yet generating enough revenue or profits to justify the massive spending on infrastructure. Microsoft Corp. and Nvidia are committing to invest up to a combined $15 billion in Anthropic PBC, in a move that ties the AI developer closer to two of the biggest backers for its rival OpenAI.

“The question isn’t really whether we’re in a bubble,” said Sonu Varghese at Carson Group. “The real question is how long the current trend in AI spending will last and how bad the fallout will be when it ends.”

The S&P 500 is down more than 3% this month, on pace for its worst November since 2008. Volatility has roared back. Wall Street’s so-called fear gauge, the Cboe Volatility Index, topped 24 — above the key 20 level that causes concern for traders — and reached its highest in a month.

Also high on the list of worries are whether the Federal Reserve will cut interest rates next month. Traders have less conviction about another reduction in borrowing costs, with swaps now implying a less-than-50% likelihood of a December move. Several policymakers have recently cautioned against one, citing the risk of inflation, although Fed Governor Christopher Waller repeated his view in favor of lowering rates.

Treasuries are on course for their first back-to-back gains of the month, edging higher amid the selloff in stocks and fresh signs of weakness in the US labor market.

Jobless claims totaled 232,000 in the week ended Oct. 18, according to the Labor Department website showing historical data for claims. Companies shed 2,500 jobs per week on average in the four weeks ended Nov. 1, according to ADP Research.

The ADP snapshot of the labor market has helped bridge the gap with official employment data delayed by the longest government shutdown in history. While funding to official statistics agencies has been restored, it’s still unclear when October economic data will be issued.

“The stock market has started to doubt the Fed’s ability to cut rates in December, so should Thursday’s jobs report come in weaker than expected, it may clear the path for the Fed to cut in December and fuel the Santa Claus rally we anticipate, which could push the S&P 500 to 7,100 by year-end,” said James Demmert at Main Street Research.

Nvidia Reports

Nvidia, on a standalone basis, has grown larger than the energy, materials, and real-estate sectors combined and depending on the day, it even exceeds the combined weight including the utilities sector, according to Ryan Grabinski at Strategas. It’s also bigger than the entire industrials sector.

“The outcome is likely to send ripple effects through both US and international markets,” Grabinski said. “Although expectations for AI more broadly have cooled in recent weeks, this report has the potential to shift sentiment back to optimism. That said, the bar is undeniably high right now.”

Following Nvidia’s results, traders will then focus on the September US jobs report, scheduled to be released on Thursday after a lengthy delay.

In commodities, oil rose as hawkish rhetoric by the European Union’s top diplomat raised expectations that sanctions on Russia will tighten. Meanwhile, gold wavered.

Some of the main moves in markets:

Stocks

Hang Seng futures rose 0.5% as of 7:32 a.m. Tokyo time S&P/ASX 200 futures fell 0.2% Nikkei 225 futures rose 0.8% Currencies

The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1580 The Japanese yen was little changed at 155.48 per dollar The offshore yuan was little changed at 7.1116 per dollar The Australian dollar was little changed at $0.6506 Cryptocurrencies

Bitcoin rose 0.9% to $93,271.57 Ether rose 0.9% to $3,124.01 Bonds

The yield on 10-year Treasuries declined three basis points to 4.11% Australia’s 10-year yield was little changed at 4.44% This story was produced with the assistance of Bloomberg Automation.

©2025 Bloomberg L.P.