Premarket trading in the U.S. saw a broad pullback among memory-chip names after Alphabet’s Google unveiled a new AI model that it said could reduce the memory required to run large language models. SanDisk fell nearly 4%, while Micron Technology, Western Digital and Seagate Technology each slipped about 2%. Qualcomm moved almost 2% lower. Bernstein subsequently downgraded Qualcomm to market perform from outperform, citing memory headwinds in the industry, according to CNBC.
Mining stocks were pressured as gold and silver prices declined. First Majestic Silver dropped about 5%, with Coeur Mining and Hecla Mining both down around 4%. Newmont and Freeport-McMoRan each fell roughly 3%.
Software name Adobe declined about 1.4% after William Blair downgraded the stock to market perform from outperform, saying it remains unclear whether the stock will be an AI winner or loser at this juncture.
On the positive side, Navan, a travel technology firm, climbed about 18% after guiding for stronger revenue in 2027. Navan expects full-year revenue of between $866 million and $874 million, versus a FactSet consensus of $840.8 million. The company also reported fourth-quarter adjusted earnings per share and revenue that topped Wall Street expectations.
MillerKnoll slumped about 17.5% after posting fiscal third-quarter adjusted earnings of 43 cents on revenue of $926.6 million. The results reflected a year-over-year drop in adjusted earnings and a rise in revenue. The company flagged an expected $8 million to $9 million impact in the fourth quarter tied to the Middle East conflict, driven by limited shipments to that region and higher logistics costs.
Snap dipped about 1.3% after the European Union opened an investigation into whether the company failed to do enough to prevent child grooming and the sale of illegal goods on its platform.
Worthington Steel skidded nearly 13% in light trading after reporting fiscal third-quarter adjusted earnings of 27 cents per share, down from 35 cents a year earlier.
CNBC’s reporting team notes the moves were driven by a combination of AI-related demand expectations, sector-specific earnings signals, and wider risk sentiment around technology and industrial equities. The broader market backdrop and the pace of AI adoption remain key variables shaping these stock-specific trajectories, with investors balancing near-term earnings signals against longer-term AI demand implications.
Key takeaways
- Memory-chip stocks slide. SanDisk down nearly 4%; Micron, Western Digital and Seagate each about 2% lower, after Google’s AI model raised questions about memory demand. Market chatter points to ongoing memory headwinds affecting the sector.
- Chipmaker downgrade. Qualcomm declines close to 2% as Bernstein trims its rating amid the memory cycle concerns.
- Mining names soften on metal price move. First Majestic Silver around 5% lower; Coeur Mining and Hecla Mining about 4% weaker; Newmont and Freeport-McMoRan off roughly 3%.
- AI-related software and travel tech show mixed signals. Adobe down about 1.4% on a downgrade; Navan jumps about 18% on strong 2027 revenue guidance and solid quarterly results.
- Corporate earnings under pressure. MillerKnoll declines sharply on weaker earnings and higher fourth-quarter costs tied to geopolitical events; Worthington Steel also falls on softer profitability.
What drove the move
The initial catalyst cited by market participants was Google’s introduction of a new AI model, which the company said could reduce memory requirements for running large language models. The claim fed a wave of concern among memory-chips peers about future demand, contributing to a pullback in memory-focused names. CNBC reported the details surrounding the AI model and its potential implications for memory usage, setting the tone for a risk-off tilt in premarket trading among related equities.
In parallel, the semiconductor space faced a calibration of expectations as earnings signals and analyst commentary highlighted persistent headwinds from the memory cycle. Bernstein’s downgrade of Qualcomm to market perform reflected a broader worry about sustained pressure on memory and its downstream suppliers, a theme reiterated by traders poring over semiconductor indicators this morning.
Market reaction
Premarket price action showed a clear bifurcation: memory and mining stocks moved lower, while a handful of software and tech-adjacent names displayed mixed results. The broad tilt suggested investors are weighing near-term earnings and macro sensitivity against longer-term AI deployment trajectories. Navan’s double-digit rally underscored that revenue visibility and growth outlooks remain critical differentiators among software and travel tech names in a choppy market environment.
What analysts are saying
Analysts cited in the coverage noted the impact of AI-driven memory efficiency on hardware demand. Bernstein’s downgrade of Qualcomm highlighted concerns about cyclicality in memory pricing and the potential for continued volatility in memory suppliers. On the other hand, Navan’s revenue outlook is seen as a positive read on demand for travel tech platforms through 2027, while MillerKnoll’s deterioration in profitability and the associated cost pressures raised questions about margins in the near term.
Bigger picture
Across markets, the performance of AI-related equities remains tethered to how quickly AI adoption translates into durable demand for hardware memory and software platforms. The afternoon session will likely reflect a synthesis of AI deployment momentum, evolving memory-market dynamics, and the evolving macro backdrop—rates, inflation expectations, and geopolitical factors—that shape corporate earnings trajectories. Investors will be listening for fresh guidance from technology and materials names that could redefine the near-term volatility landscape.
What to watch next: investors will monitor further commentary on memory pricing and AI-driven efficiency gains, along with upcoming earnings updates and guidance from related sectors. Developments from hardware suppliers, software platforms tied to AI, and miners with exposure to precious metals will continue to influence sentiment as markets assess the balance between growth potential and cost pressures.
Reporting contributed by CNBC’s Sarah Min and Lisa Han.
