The US hyperscalers have captured the minds of investors for years now, but as the artificial intelligence capex cycle accelerates, batching these stocks into one group is actively unhelpful, according to some experts.
Nvidia, Apple, Microsoft, Amazon, Alphabet, Tesla and Meta (commonly referred to as the magnificent seven) are some of the most well-known stocks in the global market, dominating the top 10 of the MSCI ACWI.
For years, they seemed to march unstoppably upwards, with the aggregate stockmarket capitalisation of the seven reaching $22.5trn in May 2026, according to data from AJ Bell. For comparison, the previous peak for their valuation was in October 2025.
“The release of ChatGPT by OpenAI in November 2022 has clearly done much to turbo-charge their profits, which have embarked upon a growth trajectory even faster than the one in evidence before,” AJ Bell Investment director Russ Mould noted.
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However, some experts have argued perceiving these companies as one group trading in unison is pointless.
In May, Jeff Blazek, co-CIO of multi-asset at Neuberger, said: “The ‘magnificent seven’ moniker has had a good run.
“But the basket is beginning to break at the same time more granular AI-related equity stories are gathering momentum.”
Reliance on this term undermines the significant dispersion present in the US hyperscalers, but also tech and AI more widely, according to experts. It no longer reflects the reality of how these stocks behave or what is driving them.
Hugh Gimber, global market strategist at JP Morgan Asset Management (JPMAM), noted during the firm’s recent half-year outlook that the moniker did not feature at all in their current thinking.
“It’s probably the first time in five years that it’s not featured, because it’s just no longer a relevant concept,” he said. “One of the key messages on tech is that the ‘magnificent seven’ has really become an obsolete term.”
Chris Carter, investment manager on the Jupiter Origin fund, agreed the term is broadly obsolete.
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“The investment world is replete with out-of-date acronyms,” he told Portfolio Adviser. “These acronyms, like magnificent seven, are at best annoying and at worst highly misleading.”
“The reason I particularly dislike the magnificent seven as a shorthand is that these companies are almost entirely different,” Carter said.
Despite being all batched as tech or AI companies, they are all driven by almost entirely different things and are in different spaces. Tesla is in an almost entirely separate market to something like Microsoft, which is completely different to something like Amazon, the Jupiter Origin manager explained.
JPMAM’s Gimber added: “This is no longer a market which is moving in unison as tech, good or bad; the market is doing a much better job differentiating between them.” This is reflected in the performance gap you can see between some of these names even more recently, he noted.
Neuberger’s Blazek said: “Consider Alphabet and Microsoft specifically: a year ago, the former was written off as lagging badly on AI, while the latter was deemed a consensus winner.
“That read has inverted – starkly.”
For comparison, Alphabet is up more than 100% over the past 12 months according to data from Hargreaves Lansdown. Compare this to Microsoft’s performance, which has slid almost 22.8% over the past year as the software sell-off hit it hard.
Jupiter’s Carter added that, while the magnificent seven have done well on average for years, this is mostly owing to the performance of two big names: Alphabet and Nvidia.
Meanwhile, he argued Apple, Amazon and Tesla have all been essentially “trading sideways” in market terms, while Meta and Microsoft have arguably been underperforming for even longer.
“There’s no investment case for the term; people say, should I buy the mag seven – the answer is it depends; some are better than others.
“To think and talk about them like they’re one animal moving in the same time at all times, or even over time, is completely wrong,” Carter said.
Certainly, some stocks within this group can be batched together, he said. For example, he conceded that Alphabet and Meta are both spenders, not beneficiaries of the AI spending boom, which might make it tempting to look at them together.
That said, even these two are wildly different in performance, with Meta down almost 16% over the past 12 months, compared with Alphabet’s meteoric rise.
“It’s blindingly obvious that Apple is a different company from Microsoft and that Microsoft is a different company from Nvidia; people just lump them together out of laziness.”
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