The sentiment on Wall Street toward AI-related companies is undergoing a notable shift, with OpenAI losing momentum while Alphabet (GOOGL.US) gains traction. The ChatGPT maker is no longer seen as the cutting-edge leader in AI technology and faces growing skepticism over its lack of profitability and the need for rapid expansion to meet heavy spending commitments. Meanwhile, Alphabet is emerging as a well-funded competitor with a sprawling presence across the AI supply chain.
"Earlier this year, OpenAI was the golden child, while Alphabet was viewed very differently," said Brett Ewing, Chief Market Strategist at First Franklin Financial Services. "Now, the market has cooled significantly on OpenAI." Consequently, companies tied to OpenAI—including Oracle (ORCL.US), CoreWeave (CRWV.US), AMD (AMD.US), Microsoft (MSFT.US), Nvidia (NVDA.US), and SoftBank Group (which holds an 11% stake in OpenAI)—are facing heavy selling pressure. In contrast, Alphabet's resurgence is lifting not only its own stock but also shares of its partners, such as Broadcom (AVGO.US), Lumentum (LITE.US), Celestica (CLS.US), and TTM Technologies (TTMI.US).
The reversal has been dramatic in both scale and speed. Just weeks ago, any association with OpenAI could send a company's shares soaring. Now, those ties are increasingly seen as a liability. Given OpenAI's central role in fueling the three-year AI market rally, this shift carries broad implications. "Investors have recognized the complexities of its financing structure, circular transactions, and debt issues," Ewing noted. "While Alphabet’s ecosystem may have similar challenges, OpenAI’s exposure is extreme, and this realization has altered market sentiment."
A basket of OpenAI-linked stocks rose 74% in 2025, a solid gain but far below the 146% surge for Alphabet-affiliated stocks. The tech-heavy Nasdaq 100 climbed 22%. Doubts around OpenAI trace back to August, when its GPT-5 release underwhelmed. Last month, skepticism deepened as Alphabet’s latest Gemini AI model earned praise. In response, OpenAI CEO Sam Altman declared a "Code Red" to improve ChatGPT’s quality, delaying other projects until the flagship product meets standards.
Alphabet’s perceived strength extends beyond Gemini. The S&P 500’s third-largest company by market cap boasts ample cash reserves, Google Cloud, and a growing semiconductor division—not to mention advantages in AI data, talent, and distribution, plus subsidiaries like YouTube and Waymo. "There’s a growing consensus that Alphabet has all the ingredients to dominate AI model development," said Brian Colello, Senior Equity Strategist at Morningstar. "Months ago, investors would’ve handed that title to OpenAI. Now, there’s more uncertainty, competition, and risk that OpenAI won’t prevail."
The gap between first and second place carries significant financial consequences. If users shift to Gemini, slowing ChatGPT’s growth, OpenAI may struggle to fund cloud capacity from Oracle or chips from AMD. Meanwhile, Alphabet’s partners thrive: Lumentum, which supplies optical components for Alphabet’s data centers, has seen its stock triple this year, while Celestica (up 252% in 2025) provides hardware for its AI infrastructure. Broadcom, maker of Alphabet’s TPU chips, has surged 68% since late 2024.
OpenAI’s recent ambitious deals have drawn scrutiny. "These moves rightly raise concerns about whether OpenAI can fund its commitments or is overpromising," Colello said. Initially, investors cheered such deals as signs of a new AI winner. But as sentiment soured, skepticism took hold. "Big numbers seemed plausible when people believed in revenue and profitability," said Brian Kersmanc, Portfolio Manager at GQG Partners, which oversees $160 billion. "Now, disbelief has set in." Kersmanc likened the AI frenzy to a "stimulant-fueled dot-com bubble" and said his firm has shifted from overweighting tech to deep caution.
OpenAI’s PR missteps haven’t helped. CFO Sarah Friar recently suggested the U.S. government should "backstop guarantees for financing," sparking backlash before she and Altman clarified no such request was made. Then came Altman’s podcast remark on funding: "If you want to sell your shares, I’ll find a buyer." The flippancy is troubling given HSBC’s estimate of a $207 billion gap between OpenAI’s projected revenue and spending through 2033. "Closing it requires higher revenue, cost controls, or fresh capital," wrote analyst Nicholas Cote-Collison on November 24. With OpenAI’s 2025 revenue forecast at $12 billion, computing costs "heighten investor nerves about returns—for OpenAI and the intertwined AI ecosystem."
Not all is lost for OpenAI-linked firms. Oracle and AMD operate in high-demand sectors with customers beyond OpenAI. A Wells Fargo analysis suggests their stock weakness may present buying opportunities, as ChatGPT-related valuations now trail Gemini-linked peers for the first time since 2016. "There’s untapped demand and market penetration that will ultimately support growth," said Kieran Osborne, CIO of Mission Wealth, which manages $13 billion. "Monetization is the endgame—progress toward it sustains the investment thesis."
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