Meta stock declines, joining Magnificent Seven losses in 2025

Meta Platforms Inc. has become the last of the Magnificent Seven stocks to fall into negative territory in 2025. On Tuesday, shares dropped over 4%, following a recent wave of selling. Previously, Meta had enjoyed a significant rally, gaining nearly 26% before this decline. It had achieved a remarkable 20 consecutive days of increases. However, all those gains have now been wiped out. Analyst Justin Patterson from KeyBanc Capital Markets noted that Meta's investments in artificial intelligence have limited its financial flexibility. He lowered his price target for Meta stock from $750 to $710, citing increased fixed costs associated with AI, which makes it harder for the company to cut expenses in tough times. The tech sector as a whole is facing challenges this year. Economic uncertainties, including tariff policies from the Trump administration, and concerns over the future of AI, have put pressure on big tech companies. The Magnificent Seven stocks—Apple, Microsoft, Nvidia, Amazon, Tesla, Alphabet, and Meta—had been expected to benefit from AI advancements. However, the Bloomberg Magnificent 7 Total Return Index is down 16% this year and more than 20% from its peak last December. Notable stock declines include Tesla, which is down 44%, and Alphabet, down 17%. Both Apple and Nvidia have decreased by 14%. The broader Nasdaq 100 Index has also fallen, down 7.3% this year, and is now more than 12% below its peak. Big tech's past two-year success has led investors to take profits amid this uncertainty.