MW Intel, Adobe and these other 'AI loser' stocks could get left behind in the next phase of the tech boom
By Christine Ji
These 12 tech companies are most vulnerable to having their business models upended by the AI revolution, according to Wedbush Securities
Rising memory costs driven by AI demand could squeeze gross margins for hardware makers such as Intel, Wedbush warns.
As artificial intelligence transforms the economy and creates new winners, companies that don't adopt the technology fast enough face the risk of being left behind.
In a report Monday, Wedbush Securities analysts identified a basket of 12 "AI losers," which they deemed to have the highest probability of being "left in the dust" as the AI trade progresses. The list features stocks the firm rates at neutral or underperform: Intel $(INTC)$, HP $(HPQ)$, Qualcomm $(QCOM)$, Uber Technologies (UBER), Lyft $(LYFT)$, Pinterest (PINS), Trade Desk (TTD), Adobe $(ADBE)$, DocuSign (DOCU), Workday (WDAY), Nice $(NICE)$ and Maplebear (Instacart) $(CART)$.
Analysts at Wedbush recently shifted away from their bullish stances on Pinterest and Nice shares.
Even though Intel, HP and Qualcomm build hardware, analyst Dan Ives argues they are on the "loser" list because the AI infrastructure boom is actually hurting their core businesses through a phenomenon he calls the "memory squeeze." As the cost of memory increases because demand is outpacing supply, these hardware providers will have difficulty passing their costs off to consumers who buy PCs.
Even Intel's government backstop won't provide much help, as the company has failed to secure meaningful deals and is losing share to Advanced Micro Devices $(AMD)$ in the AI infrastructure market, the Wedbush team argued. And since roughly 60% of Intel's sales come from PCs, not AI servers, Ives anticipates that the company's gross margins could contract by more than 5% by the end of 2026.
Read: Intel's stock has climbed 'too far, too fast.' Why BofA is sounding a warning.
Software stocks such as Adobe, Docusign, Workday and Nice have been hit hard by fears that AI will render traditional software solutions obsolete, and Ives doesn't think they'll be able to stage a comeback. He argues that these companies depend on high-cost subscription models that charge per user, while AI favors lower-cost "consumption" models that charge by usage.
For Adobe, annual recurring revenue in its digital-media business, which includes services like Illustrator and Photoshop, has been "decelerating slightly" when excluding currency impacts, Ives wrote. And Adobe "has struggled to materially accelerate monetization" from its own efforts with generative AI, he added.
Relative to peers, Adobe has been slow to execute on Firefly, its AI offering, according to Ives. That means the company will end up "defending [market] share rather than taking it," he added. He also anticipates that Adobe's core customer base of professionals will shrink over time as cheaper AI-driven creative tools catch on.
Ives's recent downgrade of Nice, which provides AI-enabled cloud platforms for customer experience, also reflects the threat of a declining user base. Hyperscalers such as Alphabet $(GOOGL)$ $(GOOG)$, Amazon.com (AMZN) and Microsoft $(MSFT)$ are entering Nice's market, the Wedbush team noted.
Also read: The old software investing playbook is dead. Here's where to put your money now.
Big Tech companies are also beating out smaller advertising businesses such as Pinterest and Trade Desk, as well as food-delivery and ride-hailing names such as Instacart, Uber and Lyft.
Advertisers are increasingly prioritizing Amazon, Google and Meta Platforms (META) ecosystems because they collect data directly from their customers, leading Wedbush analyst Scott McDevitt to take a more cautious view on shares of Pinterest in a Monday note.
Meanwhile, with the rise of Tesla $(TSLA)$ and Google's Waymo, ride-share companies face "massive disruption" as the value shifts away from providing an asset-light marketplace and toward platforms that own the entire autonomous-driving tech stack, Ives wrote.
Read: Meta's stock is now this analyst's 'best idea.' Why all the AI spending could be worth it.
-Christine Ji
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December 08, 2025 10:17 ET (15:17 GMT)
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