The third quarter of 2025 revealed dramatic shifts in fund positions across U.S. equities. Technology leaders continued to attract massive inflows, but not all of the “Magnificent Seven” shared in the gains. While Nvidia and Microsoft saw record increases, Apple experienced a sharp decline, underscoring a broader rebalancing trend among institutional investors.
Biggest Position Increases
- Nvidia Corporation: + USD 618.2 billion — the largest increase, fueled by relentless demand for GPUs powering AI and data centers. Nvidia’s data center revenue surged over 140% year-over-year, briefly pushing its market cap near USD 4 trillion.
- Microsoft Corporation: + USD 436.8 billion — driven by Azure’s 30% YoY growth, with nearly half attributed to AI services. Hedge funds increasingly view Microsoft as a “rising star” in AI infrastructure.
- Broadcom Inc.: + USD 322.0 billion — benefiting from semiconductor demand and networking expansion, particularly in AI supply chains.
- Meta Platforms Inc.: + USD 206.4 billion — investor confidence grew as AI-driven advertising boosted revenue growth.
- Netflix Inc.: + USD 121.9 billion — supported by global subscriber growth and AI-powered content recommendations, reportedly saving the company USD 1 billion annually.
Notable Decline
- Apple Inc.: – USD 366.0 billion — a sharp drop in fund positions, reflecting investor caution amid hardware saturation and competitive pressures in services. While Apple remains a mega-cap anchor, funds appear to be rotating toward firms with stronger near-term AI exposure.
Supplementary Market Context
- AI boom drives Q3 rally: The S&P 500 surpassed 6,500 points, powered by tech stocks heavily invested in AI.
- Hedge fund rotations: Several major funds trimmed Nvidia and Amazon positions, citing concerns over inflated AI valuations, while increasing bets on Microsoft, Meta, and Netflix.
- Sector leadership: Information technology and communication services were the strongest-performing sectors in Q3, while healthcare and energy lagged.
- Macro backdrop: A Fed rate cut and easing tariff pressures supported equity inflows, even as inflation and employment data showed signs of strain.