Wall Street sentiment toward companies associated with artificial intelligence is changing. And it all revolves around two companies: OpenAI is in decline, while Alphabet () is on the rise.
The creator of ChatGPT is no longer seen as a technological reference and is facing questions about the lack of profitability and the need to grow quickly to pay for its massive spending commitments. At the same time, Google’s parent company is emerging as a competitor with great financial power and presence in all segments linked to AI.
“OpenAI was the golden child earlier this year, and Alphabet was viewed very differently,” said Brett Ewing, chief strategist at First Franklin Financial Services. “Now sentiment is much more subdued towards OpenAI.”
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Actions under pressure
As a result, shares of companies linked to OpenAI — mainly Oracle Corp., CoreWeave Inc. and Advanced Micro Devices Inc., but also Microsoft Corp., Nvidia Corp. and SoftBank (which owns 11% of the company) — are under strong selling pressure. Meanwhile, Alphabet’s momentum is lifting not only its shares but also those of associated companies such as Broadcom Inc., Lumentum Holdings Inc., Celestica Inc. and TTM Technologies Inc.
The change was dramatic in magnitude and speed. Just a few weeks ago, OpenAI was causing huge rallies in any company with any ties to it. Now these connections feel more like a weight. It’s a transformation with broad implications, given the privately held company’s central role in the “AI craze” that has driven the stock market rally over the past three years.
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“A light was shed on the complexity of financing, the circular agreements, the debt issues,” Ewing explained. “I’m sure this exists to some extent in the Alphabet ecosystem as well, but it has proven to be extremely intense in the OpenAI deals — and recognizing that has changed sentiment.”
A group of companies linked to OpenAI rose 74% in 2025 — a considerable performance, but well below the 146% recorded by shares exposed to Alphabet. The tech-heavy Nasdaq 100 is up 22%.
Competitive alphabet
Skepticism about OpenAI dates back to August when GPT-5 was released to mixed reactions. It spiked last month when Alphabet released the latest version of the Gemini model to widespread praise. As a consequence, Sam Altman, CEO of OpenAI, declared a “code red” effort to improve the quality of ChatGPT, postponing other projects until the main product was aligned.
Alphabet’s perceived strength goes beyond Gemini. The company has the third largest market capitalization in the S&P 500 and a significant amount of cash. It also has adjacent businesses, such as Google Cloud and a semiconductor manufacturing operation that is gaining traction. And that’s before considering its AI data volume, talent, distribution, and successful subsidiaries like YouTube and Waymo.
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“There is a growing realization that Alphabet has all the pieces to become the dominant builder of AI models,” said Brian Colello, senior technology equity strategist at Morningstar. “A few months ago, investors would have given that title to OpenAI. Now there is more uncertainty, more competition, more risk that OpenAI will not be the clear winner.”
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Representatives for OpenAI and Alphabet did not respond to requests for comment.
Race for 1st place
The difference between being in first or second place goes far beyond prestige — it also has significant financial impacts for companies and their partners. For example, if users moving to Gemini slow ChatGPT’s growth, it will be harder for OpenAI to pay for Oracle’s cloud computing capacity or AMD’s chips.
In contrast, Alphabet’s partners in building its AI ecosystem are thriving. Shares of Lumentum, which makes optical components for Alphabet’s data centers, have more than tripled this year, putting the company among the top 30 performers in the Russell 3000 index. Celestica provides the hardware for Alphabet’s AI expansion, and its shares are up 252% in 2025. Meanwhile, Broadcom — which is building the TPU chips used by Alphabet — has seen its share price jump 68% since the end of the year past.
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OpenAI has announced a series of ambitious deals in recent months. This flurry of moves “has rightly generated scrutiny and concern about whether OpenAI can finance all of this, whether it’s not taking on more than it’s capable of executing,” Colello said. “The timing of revenue growth is uncertain, and each improvement made by a competitor increases the risk that OpenAI will not be able to achieve its goals.”
It’s worth noting that many of these deals were initially enthusiastically received by investors because they appeared to shape the next generation of AI winners. But with the change in sentiment, these same investors are now adopting a cautious stance.
“When people thought OpenAI would be able to generate revenue and become profitable, those numbers seemed possible,” said Brian Kersmanc, portfolio manager at GQG Partners, which manages about $160 billion in assets. “Now we’re at a point where people have stopped believing and started questioning.”
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