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Following Alphabet’s stellar earnings report Wednesday, analysts were quick to declare that the Google parent had blossomed from an AI laggard into a leader. The company posted strong revenue and profit growth, driven in part by heavy investment in artificial intelligence, and noted that its Gemini app had grown to more than 750 million monthly active users.

Still, usage data suggest Gemini remains far behind the market leader — at least as far as usage.

While Gemini is growing faster than OpenAI’s ChatGPT — up 19% month over month versus 4% — it still trails by a wide margin in overall usage. In January, Gemini logged more than 2 billion global visits, according to new data from Similarweb, less than half of ChatGPT’s 5.7 billion.

Palantir’s market pounding continues, as the intelligence, defense, and commercial AI software company slumps along with other retail favorites, bitcoin, and high-beta momentum trades such as space plays AST SpaceMobile and Rocket Lab, and quantum computing trades D-Wave Quantum and Rigetti Computing through the first half of Thursday’s session.

Palantir partisans could credibly argue that Alex Karp’s company shouldn’t be lumped in with that sort of crowd, some of which are a long way from profits, when Palantir has posted outstanding financial performance in recent quarters. But the market doesn’t seem to be listening — or at least, has stopped hearing reassurance after the stock’s massive run-up.

Thursday’s drop of more than 5% — shortly before 12 p.m. in New York — brings its cumulative losses to more than 35% since its November 3, 2025, all-time closing high. And that’s done considerable amounts of damage to the technical backdrop for the shares.

Late last month, Palantir traded far below its 200-day moving average, a key level of technical support that had held since May 2023, when the shares first started to gather steam. A break below the 200-day moving average underscores a serious loss of momentum for a stock, and can prompt some traders to reconsider their views on whether a stock that has been a winner has truly lost its mojo.

A smattering of observations on how the character of the AI trade has changed this year — with, obviously, some of these trends not having waited for a full turn of the Earth around the sun to start to establishing themselves:

• All the bullish oxygen is being sucked out of the room and squarely into the memory chip shortage, which is offering bumper profits for a handful of firms. On a related note, semicap equipment stocks have been an upstream beneficiary of this dynamic. The underlying message is that near-term scarcity is being rewarded by the market.

• That the big capex spenders will generate a high return on investment from their outlays is not something traders are willing to take for granted. Big budgets are not necessarily getting applauded; even companies that seemingly earn the benefit of the doubt by posting accelerating revenue growth, à la Meta, aren’t able to maintain those gains for long.

• The big “consumers” of memory chips are getting squeezed. This includes the hyperscalers, obviously, but even more so the likes of Qualcomm, which has to wait behind these giants in line for supplies, which played a role in the company’s underwhelming outlook.

• For public markets, the theme is more of a net negative than a positive. Firms seen as the most likely to be disrupted by AI (basically, the entire software industry) are getting indiscriminately clobbered, regardless of how good their quarterly results and guidance are.

• The facilitators of disruption, in many cases, have not yet arrived on public markets but plan to do so this year. That’s SpaceX/xAI, OpenAI, and Anthropic. So if the AI theme has seemed a little “negative sum” in this year, that might be about the room that investment firms know they’re going to need in their portfolios to add these stocks once they’re able to (or, in some cases, ahead of time).

• And this isn’t really a 2026 dynamic, strictly speaking, but the two biggest chip companies have been dead money for months. Since the end of Q3, Nvidia and Broadcom are both negative, with the S&P 500 up about 2% over this span.

As bitcoin continues to set new cycle lows, altcoins are revisiting levels not seen in several years. Over the past 24 hours:

• XRP has dropped nearly 19% to trade at $1.24, its lowest mark since November 2024;

• Solana is down 7% to trade under $84, returning to a price point last recorded in January 2024;

• Dogecoin has slid 10% to $0.09, a price last seen in September 2024;

• Chainlink is down below $8.40, erasing all gains made since October 2023. 

It’s hitting the crypto ecosystem hard: 305,791 traders have been liquidated in the past 24 hours, with total liquidations standing at $1.46 billion, CoinGlass data shows. The market capitalization of the entire crypto space is now at $2.35 trillion, a drawdown of 7.5% in the last 24 hours and a stunning 46.6% plunge from the all-time high of $4.4 trillion set in October 2025. 

The altcoin market is correlated with bitcoin, with both undergoing a steep decline, according to Devin Ryan, director of financial technology research at investment bank Citizens Capital Markets & Advisory. 

As to what is driving the downswing, Ryan pointed to the October sell-off that triggered the massive initial wave of liquidations as well as a number of macro headwinds, such as ongoing geopolitical conflicts, concerns of another government shutdown, and uncertainty surrounding a new Fed chair.

There’s volatility in the asset class because of market structure issues and concerns around where bitcoin goes from here from a price perspective, Ryan said.

Ryan expects the correlation between bitcoin and the rest of the crypto ecosystem to break down over the next year to two years.

The recent volatility highlights that cryptocurrency’s blockchain technology is still in an early phase, Ryan said. “We are still in the early days of even getting the clarity around regulation and the legislation that’s needed to progress from this world of pilot phase — what might happen on the blockchain to here’s what’s happening on the blockchain and on which blockchains,” Ryan told Sherwood News. 

Yesterday, Anthropic announced that it intends (for now) to keep its Claude chatbot free of ads. Competitors OpenAI, xAI, Meta, and Google all have expressed plans for ads in some form for their respective AI chatbots.

Anthropic also released cheeky ads depicting scenarios where people are asking questions to a personified version of their AI chatbot, only to recoil in confusion when the response transforms into a creepy ad.

It’s pretty clear that Anthropic was poking fun at the market-leading AI chatbot, ChatGPT. The characters playing the chatbot had the pitch-perfect tone of an eager-to-please ChatGPT session.

OpenAI CEO Sam Altman tried to be a good sport, calling the ads funny, but clearly they struck a nerve, prompting a 400-word post on X in which he called the ads “deceptive,” accused Anthropic of “doublespeak,” and said it was an “authoritarian company” that was heading down a “dark path.”

Altman pushed back on the depiction of how such creepy ads could show up in chats, saying that OpenAI has pledged to never weave ads into chat conversations, knowing it users would reject that.

Previewing how the rival AI startups might battle each other in the marketplace, Altman attacked Anthropic’s focus on paid subscription, rather than generous limits for free users (which appears to be working out pretty well for Anthropic):

“Anthropic serves an expensive product to rich people. We are glad they do that and we are doing that too, but we also feel strongly that we need to bring AI to billions of people who can’t pay for subscriptions.”

Both companies are racing to launch an IPO this year, which will only raise the stakes for this billionaire beef.

Google reported strong earnings yesterday that beat analysts’ expectations. But the thing that caught investors’ attention was Google’s capex plans.

The company spent a whopping $91.4 billion for all of 2025 on capex, but it plans to roughly double that amount in 2026 to between $175 billion and $185 billion.

Why does it need to spend so much? It can’t keep up with demand due to constraints on its compute capacity. Cloud computing demand is surging, and Google simply can’t fulfill all of the orders it has, because it can’t build the data centers and AI infrastructure fast enough.

Alphabet CEO Sundar Pichai was asked on last night’s earnings call what keeps him up at night:

“At this moment, maybe the top question is definitely around compute capacity. All the constraints, be it power, land, supply chain constraints — how do you ramp up to meet this extraordinary demand for this moment, get our investments right for the long term, and do it all in a way that we are driving efficiencies and doing it in a world-class way?”

Demand is so extraordinary that Google has $240 billion in “remaining performance obligations” (RPO, or revenue backlog).

This swelling backlog is not unique to Google. Microsoft just reported $625 billion in RPO, though a big chunk of that was for one customer: OpenAI. After market close today, we will see what Amazon’s RPO backlog looks like. It was $200 billion last quarter.

Today Waymo, a subsidiary of Google, announced plans to expand its autonomous ride-hailing service to Boston and Sacramento. The service is currently available to the public in six US cities, including Miami, which launched last month.

Waymo has completed 20 million fully autonomous trips and now provides about 400,000 driverless rides per week, Google CEO Sundar Pichai said on Wednesday’s earnings call. He added that Waymo will also expand to additional cities in the US, as well as to the UK and Japan.

Boston would be Waymo’s first market in New England, though regulatory hurdles remain. “Before offering fully autonomous rides to Bostonians, we’ll first need the state to legalize fully autonomous vehicles,” the company said.

Chinese EV maker Nio on Thursday said it expects to achieve its first-ever quarterly profit in its fourth quarter. Its US-traded ADRs rose more than 6% in premarket trading.

Based on a preliminary assessment, Nio projects Q4 adjusted profit from operations of between $100 million and $172 million. Wall Street analysts polled by FactSet estimated a Q4 adjusted operating loss of $19 million.

Nio attributed the preliminary results to sustained sales volume growth, vehicle margin optimization, and cost reductions. Nio delivered 124,807 vehicles in its fourth quarter, which ended in December, up 72% year over year.