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Below are AI-generated insights on moves in the information technology sector, powered by MarketReader technology.

Tuesday, July 30

VGT [-1.5%]
Vanguard Information Technology ETF (VGT) has experienced a decline, moving in tandem with the broader market, which itself has also decreased. The S&P 500 Index fell modestly, reflecting its historical correlation with VGT. Within the ETF's holdings, notable declines were observed among key contributors. Nvidia faced significant challenges due to Apple's choice of Google chips for AI training and intensified competition from Samsung in the AI memory sector. Microsoft is contending with global connection issues affecting Azure and Microsoft 365 services, raising concerns ahead of its fiscal Q4 earnings report. Additionally, CrowdStrike's stock dropped sharply as Delta Air Lines seeks compensation for a cyber outage linked to its software, raising apprehensions about potential long-term impacts on client spending.

NVDA | $106.06 | -4.9% | -127.7B

TSM | $154.57 | -3.3% | -133.3B

MSFT | $419.17 | -1.8% | -55.7B

CRWD | -9.5% | -5.4B
Shares of CrowdStrike Holdings Inc. have dropped significantly following reports that Delta Air Lines is seeking compensation for a recent cyber outage linked to CrowdStrike's software. This outage resulted in the cancellation of over 6,000 flights, with analysts estimating substantial financial impacts. The "Falcon Sensor" software reportedly caused Microsoft Windows to crash, leading to widespread disruptions across various industries. Evercore ISI has placed CrowdStrike on its Tactical Underperform List and reduced its price target from 350 to 325, citing concerns over client sentiment and spending. Additionally, a survey revealed that many clients are considering reduced expenditures on CrowdStrike's products and expect pricing concessions due to the incident. Since the outage, CrowdStrike's stock has plummeted over 24%.

PEGA | +6.0% | +354.1M
Pegasystems Inc. has seen a notable price increase today, rising significantly following a favorable ruling from the Virginia Court of Appeals. The court reversed a previous jury verdict that held Pegasystems liable for misappropriating trade secrets from Appian Corporation, citing insufficient evidence against Pegasystems. In reaction to this legal development, Appian's stock fell sharply. Additionally, Pegasystems is outperforming its sector peers and is experiencing unusually high market volume today. Analysts have raised price targets for Pegasystems, with DA Davidson adjusting theirs from 60 to 70 while maintaining a neutral rating. Barclays set their target at 69 with an equal weight rating, and Citigroup lowered theirs from 87 to 82 but retains a buy rating. Overall, the consensus among analysts remains a Moderate Buy, reflecting a mix of hold and buy ratings.

NVDA | -4.9% | -127.7B
NVIDIA Corp is experiencing a notable decline, aligning with significant downward movements in its sector. The company's competitive landscape has intensified as Apple has chosen Google's chips over NVIDIA's for training AI models, presenting potential challenges for NVIDIA. Additionally, NVIDIA has granted approval to Samsung for its high-bandwidth memory (HBM3) chips, which could bolster Samsung's position in the rapidly evolving AI chip market. This development comes amid growing skepticism regarding the practical applications of AI in gaming, as expressed by Tencent’s cloud executive. Furthermore, NVIDIA recently unveiled new tools aimed at humanoid robotics development, underscoring its ongoing commitment to emerging technology sectors.

AMKR | -17.3% | -1.3B
Amkor Technology shares have dropped significantly following the release of its Q3 guidance, which fell below consensus expectations. The company projects Q3 earnings per share (EPS) between 0.42 and 0.56, while the consensus estimate is 0.67. Additionally, Amkor anticipates Q3 revenue between 1.785 billion and 1.885 billion, slightly lower than the consensus of 1.87 billion. In its recent Q2 results, Amkor reported an EPS of 0.27, exceeding estimates of 0.23, with revenues of 1.46 billion, also surpassing expectations of 1.45 billion. The guidance has raised concerns among investors, contributing to the stock's decline. Notably, Amkor is trading with unusually high market volume today and is underperforming its sector peers.

GLW | -9.0% | -3.0B
Corning Inc reported its fiscal Q2 2024 results, with core earnings per share of 0.47, surpassing the consensus estimate of 0.46. Revenue reached 3.6 billion, exceeding the expected 3.54 billion and reflecting a year-over-year increase. Despite these positive results, the stock price has declined significantly, driven by weaker-than-expected Q3 guidance projecting core sales of approximately 3.7 billion against a consensus of 3.75 billion. Additionally, Environmental Technologies sales fell, while Hemlock and Emerging Growth Businesses sales dropped sharply, primarily due to lower pricing for solar-grade polysilicon. Corning's stock is currently underperforming relative to sector peers and is trading with unusually high market volume today.

MU | -2.9% | -3.4B
Micron Technology Inc is experiencing a price increase, aligning with a broader market uptrend. The company has commenced volume production of its ninth-generation (G9) TLC NAND flash technology, which features the highest transfer speed in the industry at 3.6 GB/s. This advancement enhances performance for artificial intelligence and data-intensive applications across various platforms, including personal devices and cloud data centers. Notably, the G9 NAND is 73% denser than competing products and offers significantly improved write and read bandwidth per die. Additionally, the Micron 2650 NVMe SSD, utilizing G9 NAND, shows marked performance improvements in benchmark scores compared to competitors. Despite this technological progress, social media discussions have raised concerns about Micron's deteriorating earnings per share since 2018, reflecting apprehensions regarding future profitability.

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