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Key Highlights
- AppLovin plunged 16% following disappointing Q2 revenue and EBITDA results alongside underwhelming Q3 projections
- SanDisk shares declined 9% despite posting 372% year-over-year revenue growth due to weak Q1 outlook
- Western Digital sank 14% as investors took profits despite the company exceeding earnings forecasts
- SoundHound AI soared 24% following impressive Q2 performance and upgraded annual guidance
- Moderna gained 3.5% on FDA clearance of its mFLUSIVA influenza vaccine
Thursday’s trading session witnessed a significant shift away from technology equities, with multiple prominent companies experiencing steep declines even as traditional blue-chip stocks maintained stability. The Dow Jones Industrial Average headed toward its fourth consecutive record close.
The session’s most dramatic decline came from AppLovin, which plummeted 16% following the advertising technology firm’s failure to meet second-quarter revenue and EBITDA projections. While the company’s third-quarter revenue forecast of $2.05 billion to $2.08 billion aligned with analyst expectations, it failed to impress shareholders following the stock’s impressive rally.
Memory Sector and AppLovin Experience Steepest Declines
SanDisk experienced a roughly 9% decline despite delivering fiscal fourth-quarter revenue that skyrocketed 372% compared to the previous year, reaching $8.97 billion. The issue centered on forward guidance. The company’s first-quarter revenue projection fell short of Street expectations at the midpoint, casting a shadow over an otherwise impressive quarterly performance.
Western Digital fell 14% despite surpassing analyst projections. The storage company delivered fiscal fourth-quarter revenue climbing 44% year over year to $3.75 billion, while adjusted earnings per share of $3.56 exceeded forecasts. Although robust first-quarter guidance also topped consensus expectations, the stock’s previous 176% year-to-date advance prompted investors to lock in gains.
Additional memory sector companies also retreated. Micron decreased 3.4% while Seagate lost 3.9%, mirroring the widespread weakness across storage and memory equities.
Celestica tumbled 13% following the announcement of a $3 billion equity offering priced at $310 per share. While the company indicated proceeds would fund expansion of its global AI infrastructure operations, shareholders viewed the dilution unfavorably.
SoundHound AI and Moderna Defy Market Weakness
SoundHound AI emerged as a notable exception, jumping 24% after delivering second-quarter revenue of $61.9 million, representing 45% year-over-year growth. The voice AI company reported an adjusted loss of $0.02 per share, significantly better than anticipated, while boosting its full-year revenue outlook to a range of $230 million to $260 million.
Company executives indicated guidance would receive another update following the completion of their LivePerson acquisition.
Moderna shares advanced 3.5% after securing FDA approval for mFLUSIVA, its newly developed seasonal influenza vaccine.
The overall market witnessed capital flowing out of technology shares and into more conventional blue-chip stocks. Futures trading showed cautious sentiment during early hours as market participants monitored potential developments regarding a U.S.-Iran peace agreement and partial Strait of Hormuz reopening.
SoundHound’s substantial gains demonstrated that exceptional earnings reports could still generate significant upward momentum, even as numerous high-performing stocks faced selling pressure despite positive results.
Thursday’s session illustrated a market undergoing sectoral rotation, with some companies benefiting from earnings beats while others suffered losses notwithstanding solid fundamental performance.
The post Tech Selloff Continues: AppLovin, Western Digital, and SanDisk Shares Plummet Thursday appeared first on Blockonomi.
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