Investors are piling into bearish bets on big tech hyperscalers and key chipmakers this year, pushing several of the group into the market’s most-shorted ranks — Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG), Amazon.com Inc. (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT) alongside Broadcom (NASDAQ:AVGO), Micron Technology (NASDAQ:MU) and Nvidia Corp (NASDAQ:NVDA) all sit in S3 Partners’ list of the year’s top 10 most shorted stocks cited by CNBC.

Tesla (NASDAQ:TSLA) and SpaceX (NASDAQ:SPCX) rank No. 1 and No. 2, respectively, on the same list.

Tech Giants Face Earnings Volatility

That bearish sentiment is reflected in recent earnings reactions. Top tech stocks like Tesla, Intel, and Google saw declines, with Meta Platforms (NASDAQ:META) and Amazon also down 25% and 18% from their all-time highs.

As these companies prepare to release their financial results this week, analysts anticipate continued growth, but investor focus remains on capital spending plans, which could influence stock reactions.

Alphabet’s Earnings Impact

Alphabet’s recent performance has had a significant impact on market metrics. According to a Wednesday report by Carson Research, Alphabet contributed 92% of the net dollar-level increase in S&P 500 earnings over a five-day stretch.

However, excluding Alphabet’s revaluation gains, the company’s core operations declined, with income dropping to $14 billion from $25.5 billion a year ago. This raises concerns about the sustainability of reported earnings, as revaluation gains could become a drag if market conditions change.

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