Equity markets moved higher in midweek trading as investors rotated into AI infrastructure plays and semiconductors, with several notable name-specific moves signaling appetite for the AI-and-cloud spending cycle. The VanEck Semiconductor ETF (SMH) rose by more than 1%, while flagship chipmakers showed broad strength. Micron Technology advanced about 3%, On Semiconductor surged 10%, Marvell Technology climbed roughly 7%, and Nvidia was modestly higher around 2%.
In AI and cloud-oriented names, Akamai Technologies jumped about 7% after Bank of America upgraded the stock to Buy and lifted its price target to $175 from $130, arguing that the narrative has shifted from a legacy delivery network to a credible AI infrastructure platform. Nebius, an artificial-intelligence cloud company, surged 16% after reporting first-quarter results that included $399 million in revenue, a 684% year-over-year rise, and plans for a new AI factory in Pennsylvania powered by up to 1.2 gigawatts of power and land.
Chinese e-commerce giant Alibaba’s U.S.-listed shares rose about 6% after the company said its cloud computing unit posted a 38% year-over-year revenue increase in the first quarter, reflecting ongoing investment in AI capabilities. EchoStar gained around 4% after the Federal Communications Commission approved its roughly $40 billion spectrum sale to AT&T and SpaceX, with 50 megahertz allocated to AT&T and 65 megahertz to SpaceX. NextPower Energy rose about 12% after lifting its full-year revenue guidance to a range of $3.8 billion to $4.1 billion, from a prior outlook of $3.6 billion to $3.8 billion, and delivering a fiscal fourth-quarter beat on adjusted earnings and revenue, per FactSet.
Birkenstock fell more than 10% after missing earnings and revenue estimates for its fiscal second quarter, with the company citing headwinds from the war in the Middle East weighing on growth in the Europe, Middle East and Africa region. Resideo Technologies dropped about 17% after guiding for the current quarter’s adjusted earnings in a range of 71 to 75 cents per share, versus analysts’ expectation of 84 cents, and revenue of $1.916 billion to $1.940 billion, short of the $2.01 billion consensus. The company did report a first-quarter beat on both the top and bottom lines.
In the photonics space, which has benefited from AI and data-center demand, Coherent stood out, advancing about 6%, while Lumentum rose a little over 2% and Corning moved up around 2% as investors rotated into optical networking equities. Wix.com, by contrast, fell roughly 30% after reporting adjusted earnings of 68 cents per share, well below consensus estimates of about $1.24, per FactSet data.
Key takeaways
- Semiconductors and AI infrastructure names led gains: On Semiconductor up 10%, Nebius up 16%, and SMH up >1%.
- Upgrades and earnings drivers: Akamai up ~7% after a Bank of America upgrade and higher price target; Nebius cited strong Q1 results and expansion bets.
- Mixed earnings landscape: Alibaba and NextPower energize with cloud and revenue guidance, while Birkenstock and Wix suffer from missed expectations.
- Industry tailwinds and risks: AI and cloud compute demand support the rally, but macro and geopolitical dynamics weigh on some consumer and regional names.
What drove the move
The session’s leadership came from AI-enabled hardware and cloud infrastructure beneficiaries. Investors rotated into semiconductors as demand for AI accelerators and data-center capacity remains evident, helping lift the SMH and a cluster of chipmakers. On Semiconductor’s double-digit advance reflected relief that demand for AI and edge computing hardware remains resilient, while Nvidia’s modest gain underscored how stock-specific dynamics continue to shape the sector alongside broader AI bets.
Akamai’s jump followed an across-the-board upgrade narrative from Bank of America, which argued the company is moving from traditional content delivery toward a broader AI infrastructure platform. The upgrade underscores investor focus on edge cloud and security providers positioned to profit from AI-driven traffic and cloud-native workloads.
Nebius’ results highlighted robust early-stage demand for AI cloud capacity and the capital expenditure tied to expanding AI operations. The company’s $399 million first-quarter revenue, up 684% versus a year earlier, alongside plans for a substantial new AI factory in Pennsylvania, reinforced the theme that AI platforms require significant, location-specific infrastructure expansion.
In the traditional technology and consumer-electronics space, Alibaba’s U.S.-listed shares rallied after the cloud unit reported a 38% rise in first-quarter revenue, signaling that cloud and AI investments continue to drive growth beyond consumer commerce. EchoStar’s gain followed regulatory momentum behind wireless spectrum monetization, with the FCC approving the sale to AT&T and SpaceX, underscoring the ongoing value of spectrum assets in a high-bandwidth economy.
NextPower Energy’s upgrade to full-year revenue guidance and a Q4 beat highlighted the energy storage and power-management angle of the AI infrastructure cycle. Birkenstock’s weakness served as a counterpoint that earnings sentiment can diverge meaningfully by region and sector, especially when macro headwinds intensify.
Resideo’s results added to the bifurcated earning landscape: the company delivered a quarterly beat, yet issued a cautious current-quarter outlook, pulling the stock lower on concerns about guidance sensitivity and the margin trajectory in a consumer-facing home-security segment. In the photonics space, AI-driven demand for high-speed optical components aided gains in Coherent, Lumentum, and Corning, while Wix.com’s miss reminded investors that online services faces ongoing profitability hurdles despite a favorable AI backdrop.
Market reaction
Overall, the market reaction reflected a risk-on tilt toward AI infrastructure and semiconductors, with a subset of software, cloud, and capital-intensive plays rallying on visibility into AI adoption curves. The breadth of moves—from double-digit winners to notable declines—illustrates how investors are weighing company-specific earnings trajectories against wider macro risks and the pace of AI deployment across industries.
Analysts’ interpretations varied, but the thread tying many stories together is a belief that AI needs a robust, scalable backbone—from semiconductors and accelerators to cloud platforms and edge networks. As results accumulate, traders will scrutinize whether the spending cycle remains intact and how supply constraints, pricing dynamics, and geopolitical factors influence capex plans in the second half of the year.
Bigger picture
Investors continue to balance demand for AI infrastructure against macro considerations, including inflation, central-bank policy, and geopolitical tensions that influence technology supply chains. The day’s action suggests a continuing rotation into names that monetize AI-driven workloads, data-center expansion, and advanced networking capabilities, while consumer-focused and regionally exposed names remain sensitive to external headwinds.
Wider themes to monitor include evolving AI compute demand, the pace of cloud-transformation projects, and regulatory developments that could affect data flows and cyber-security spend. The mixed regional performance—strong results in North American AI infrastructure players alongside softness in parts of Europe and the Middle East—highlights the uneven impact of current global conditions on earnings trajectories.
Looking ahead, investors will be watching for continued AI-enterprise spending signals, cloud-computing trends, and any updates on capital expenditures tied to AI factories and edge networks. Key upcoming earnings, macro data, and central-bank communications will help set the tone for the AI and semiconductors complex as the quarter rounds out.
To stay informed, market participants should monitor earnings reports and guidance from major AI hardware, cloud, and infrastructure players, as well as any regulatory updates affecting spectrum monetization and data-center investment cycles.
