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AI data center and networking stocks take a breather after parabolic run

AI infrastructure and data center stocks are swooning on Monday after an exceptionally hot run, with the likes of Applied Optoelectronics, Lumentum, Astera Labs, Coherent, Marvell Technology, Nebius, IREN, and Applied Digital all off at least 3% as of 1:08 p.m. ET.

Most of these names didn’t fall in tandem on news of the amended agreement between Microsoft and OpenAI, but rather began to sharply extend losses shortly ahead of the open (by which time the Copilot creator was already well off its lows).

So it’s tough to cite that as a catalyst for the group. If you wanted to try to pigeonhole that as a cause of the decline: Microsoft and OpenAI's simplified relationship points to a world where AI spend is increasingly rationalized by the underlying economics, with cash-burning behemoths forced to stand on their own two feet. That may ultimately restrain what appears to be the present eye-popping demand for AI infrastructure.

On the other hand, there’s myriad signs in recent weeks of just how intense supply crunches are across networking, CPUs, and AI accelerator chips as well as elevated end-user appetite, so it’s difficult to suggest this is something fundamental as opposed to the space taking a breather ahead of hyperscalers’ earnings reports on Wednesday.

The capex budgets for Meta, Amazon, Microsoft, and Google effectively serve as sales guidance for the rest of the AI ecosystem.

For some parts of the AI trade, Monday’s tape may be a reminder that parabolic moves don’t end by going sideways. For other core contributors to the 2025-2026 advance, the skyward marches are still intact: Sandisk and Micron are zooming higher.

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Marvell cancels order with POET, citing breach of confidentiality

This is an own goal for the ages.

POET Technologies is cratering on Monday after announcing “the cancelation of all purchase orders received by the Company from Celestial AI, including the ones for initial production units first disclosed (the ‘Purchase Orders’) by the Company in a press release on April 25, 2023.”

Marvell Technology, which acquired Celestial AI, provided written notice of the cancellation on Thursday, citing “disclosures of information related to the Purchase Order and shipping information in contravention of its confidentiality obligations.”

We can zero in on the likely cause here — the interview that CFO Thomas Mika did with Stocktwits TV last week:

“We’re a supplier to Marvell now that they’ve acquired Celestial AI, who has been a customer of ours for a couple of years. And what we supply to Celestial AI are light sources — high-bandwidth, multi-frequency, high-power light sources that light up the photonic fabric that Celestial AI talks about as being the communication device between GPUs and one GPU and another GPU, a GPU and a memory device.”

Now, it’s likely that Mika provided a useful excuse for Marvell to cancel a contract it may not have wanted, thanks to its own in-house capabilities.

The worst part is: any reasonable person would have assumed that Marvell, through Celestial AI, was a customer of POET! The stock surged when Marvell acquired Celestial in December for that very reason!

On Friday, the day after POET received notice of the cancellation and one trading day before that information became public, a record $1.1 billion changed hands trading the stock. That high-water mark lasted only one session, with more than $1.3 billion in dollar volumes through 12:30 p.m. ET.

“The Company remains focused on executing its strategic priorities and advancing product development within the AI and optical networking markets to meet increasing demand,” per POET’s press release on Monday. “This effort also involves fulfilling product deliveries for other customers, including a recently disclosed purchase order with another technology company with a value of approximately $5 million.”

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Claire Yubin Oh9h

Analyst reports that OpenAI is partnering with Qualcomm for custom processors for an AI smartphone chip

Qualcomm, the worst-performing member of the Philadelphia Semiconductor Index this year which finally got its day in the spotlight on Friday, is basking in the sunshine once again. The San Diego-based firm is up 12% in early trading on Monday after an analyst said that the smartphone chip maker is partnering with OpenAI to build new custom processors for smartphones.

Per an X post from TF Securities analyst Ming-Chi Kuo late last night, OpenAI is working with Qualcomm, as well as MediaTek and Luxshare, to develop an AI agent phone, with plans for mass production to start in 2028.

Per Kuo, processors for the AI phone, which Qualcomm and MediaTek will partner to codevelop, will prioritize “power consumption, memory hierarchy management, and basic small-model execution,” in an effort to continuously understand the user’s context, while more complex or compute-intensive tasks will be handled by cloud AI. Specifications and suppliers for the processors are expected to be finalized by late 2026 or Q1 of 2027.

The reported partnership continues OpenAI’s ambitions to get into agentic AI hardware, after it announced in July 2025 that it’s building an AI device with Broadcom under the watch of Jony Ives, the former chief design officer at Apple.

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J. Edward Moreno10h

Amazon-backed X-Energy continues post-IPO rally

Nuclear energy company X-Energy continued to rise in premarket trading on Monday after rushing out of the gate on its Nasdaq debut.

X-Energy shares closed 27% above their IPO price on Friday, its first day as a publicly listed company. Shares have risen another ~16% before the bell on Monday.

The company raised $1 billion for its IPO, with high-profile backers including Amazon and Ken Griffin, the founder of the hedge fund Citadel. X-Energy had a market capitalization of $11.6 billion as of Friday’s close.

The company uses modular nuclear reactors to produce energy for industrial facilities and data centers, joining a list of energy startups including Oklo and Fermi looking to profit from the artificial intelligence boom’s massive energy demand.

X-Energy, which counts Dow, Inc. and Amazon among its clients, reported $109.3 million in revenue in 2025 and a $390 million net loss for the year.

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US stock futures erase losses on report of new Iranian proposal to reopen the Strait of Hormuz

S&P 500 futures erased small losses on Sunday evening after Axios reported that Iran, through Pakistan, is offering a fresh proposal to reopen the Strait of Hormuz and end the conflict. West Texas Intermediate futures are off their highs, but still up 1.6% as of 9:33 p.m. ET. According to Axios, this deal would punt the issue of Iran’s nuclear program to a later date.

This new potential off-ramp follows some less than encouraging news on the status of talks between the two sides. On Saturday, President Donald Trump said that he canceled a trip to Pakistan during which Steve Witkoff (special envoy to the Middle East) and Jared Kushner (Trump’s son-in-law) had been expected to negotiate with Iran. On Sunday, Trump told Fox News that Iran “can come to us, or they can call us” if they want to talk.

The Strait of Hormuz, a key choke point for global oil flows, has been largely closed since the conflict started roughly two months ago, despite a ceasefire agreement that was said to be contingent on the reopening of this waterway. In addition to Iranian military threats, which initially made passage through the strait too dangerous for most vessels to attempt, the US has also recently started a naval blockade to limit Iranian oil exports.

Tasha Matsumoto

Stocks climb to new record highs on peace talk optimism and tech rally

Stocks rose on news that President Trump will send Jared Kushner and Steve Witkoff to Pakistan to negotiate peace talks with Iran. Additionally, Intel’s Q1 earnings crush lifted semiconductor stocks.

Michael Jordan #23, Shooting Guard and Small Forward for the Chicago Bulls wearing a warm up jacket looks on during player introductions before the NBA Midwest Division basketball game against the Denver Nuggets

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