"AppLovin surged to lead the sector after Morgan Stanley raised its price target, maintaining an Overweight rating. That call centers on AppLovin's AXON AI engine, which powers its mobile advertising platform and has been the engine behind a remarkable earnings run. In Q4 2025, AppLovin reported revenue of $1.66 billion, up 66% year over year, with an adjusted EBITDA margin of 84%. Investors sold off the stock despite the strong results, but recent defense of its valuation from Wall Street has led to a bounceback."
"AI stocks generally rose last week as the VanEck Semiconductor ETF rose 1.8%. The sector continues to have a broad divergence as software stocks struggle in 2026 and certain segments of semiconductors like memory and networking see strong gains. Let's dive into some of the biggest news across the past week with some notable winners that include AppLovin, Tempus AI, and Micron. The Big Picture Semiconductors led the broader AI market, with SMH outpacing every major index on the week."
Semiconductor stocks outperformed the AI sector last week, led by the VanEck Semiconductor ETF's 1.8% gain and SMH outpacing major indexes. The AI market shows a divergence: software stocks have struggled in 2026 while segments like memory and networking posted strong gains. AppLovin rebounded after Morgan Stanley raised its $800 target and emphasized the AXON AI engine; Q4 2025 revenue reached $1.66 billion with an 84% adjusted EBITDA margin, though the stock remains roughly 38% below January highs. Tempus AI reported preliminary Q4 revenue of $367 million, up 83% year over year, and a record total contract value exceeding $1.1 billion, with diagnostics growing 121% year over year.
Read at 24/7 Wall St.
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