Apple closes at a record as investors treat it like a safe haven, while Cisco, AMD and Dell lead an AI hardware sell-off
Apple rose 0.39% to $356.27, its highest close ever, as Bernstein argued it now trades like a consumer staple. Cisco fell 6.24% on a margin squeeze despite a record quarter, and AI cloud names slid on a Microsoft report.
Photo: Daniel L. Lu (user:dllu) / Wikimedia Commons (CC BY-SA 4.0)
Friday's market split along a clear line. Companies tied to the hardware of the artificial intelligence build-out sold off, and the money went to businesses that sit furthest from it. The biggest winner of that trade was the biggest company in the world.
Apple's quiet record
Apple shares rose $1.39, or 0.39%, to $356.27, a new all-time closing high, according to MacDailyNews and Yahoo Finance data. During the session the stock touched a record of about $360.80, CNBC reported, briefly lifting its market value above $5.2 trillion. MacDailyNews put the value at $5.177 trillion at the close, well ahead of Nvidia at about $3.93 trillion and Microsoft at about $3.89 trillion.
The case behind the move came from Bernstein. In a note on Thursday, analysts led by Mark Newman argued that Apple has stopped behaving like a technology stock.
"With little correlation to tech peers, Apple now trades in line with high quality consumer stocks." - Bernstein analysts led by Mark Newman
The reason is spending. Apple's capital expenditure is less than 2% of its revenue, CNBC reported, while its Magnificent Seven peers are spending hundreds of billions of dollars on data centers. Apple has partnered with Google for AI models, many of which run directly on devices, Investing.com said. Bernstein compared Apple's valuation, about 37 times expected 2027 earnings and an all-time high for the stock, with Costco and Walmart rather than with other tech giants.
The run has come under a new boss. John Ternus succeeded Tim Cook as chief executive, and the stock has kept climbing despite rising memory costs and narrower margins, CNBC noted.
Cisco's record quarter, then a 6% drop
The sharpest reversal came from Cisco. After the bell on Thursday, the networking company reported record revenue of $18.5 billion, up 24%, raised its full-year forecast and lifted its target for AI infrastructure revenue from the big cloud operators to $9 billion. The shares rose in extended trading Thursday night.
By Friday's close they had fallen 6.24% to $95.64, the worst performance in the Dow, according to Investing.com. Investors focused on profitability. Adjusted gross margin fell 250 basis points to 65.6% from 68.1%, and adjusted product gross margin dropped 350 basis points to 63.7%, reflecting a heavier mix of hardware and higher memory costs, Proactive Investors reported. Product orders grew 21%, slower than the 35% pace of the previous quarter.
Cisco also said it is changing how it reports its AI business, moving from separate hyperscaler order figures toward revenue, because order timing is uneven. Proactive noted that the change could make it harder for investors to track near-term demand.
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AI hardware and AI clouds under pressure
Other names tied to the build-out fell hard. Advanced Micro Devices dropped 8.75% to $534.06 and Dell Technologies lost 7.18% to $344.53, according to Investing.com and Yahoo Finance data. Both were among the worst performers in the S&P 500.
The AI cloud providers, often called neoclouds, faced a separate problem. Microsoft is reevaluating its contracts with those companies and putting more emphasis on its own data centers, according to Bloomberg reporting cited by The Motley Fool. Microsoft accounted for 36% of CoreWeave's revenue in the second quarter, the Fool said, and signed a compute deal with Nebius in late 2025 worth $17.4 billion through 2031.
Nebius fell 9.92% to $115.88 and CoreWeave lost 6.13% to $53.13, according to Yahoo Finance data. Microsoft itself edged up 0.17% to $523.88. StreetInsider said several analysts cut their price targets on CoreWeave, with most keeping neutral or hold ratings.
One AI chip name went the other way. Cerebras Systems rose 11.22% to $108.72 after raising its annual sales forecast and naming Microsoft as a new cloud customer, though the stock finished well below its early highs.
Where the money went
Defensive stocks led. Coca-Cola rose 1.86% to $99.25, Chevron 1.64% and Walmart 1.51% to $128.09, making them the three best performers in the Dow, according to Investing.com. Benzinga said the consumer staples sector fund led the market with a gain of about 1.3%, while the technology fund was the weakest.
What carries into next week
Nvidia's earnings on Tuesday will test whether the rotation out of AI hardware continues. For Apple, the question is whether a stock now valued like a consumer staple can keep attracting investors who want distance from the AI spending race. For Cisco, analysts will be watching whether margin pressure from memory costs proves temporary.
