Data center stocks were flying high at the start of the year, but Wall Street turned sour on them quickly. They were among the biggest losers of the recent selloff. Most of the stocks that fell in the past few weeks weren’t just data center pure plays. Investors invested in pick-and-shovel plays during the rally, and these are mostly the stocks that fell significantly as the pendulum swung the other way.
DeepSeek caused a brief crash in data center stocks. These stocks then recovered early on as hyperscalers doubled down. But after Microsoft canceled two of its data center contracts, the bear market quickly returned to the sector. Recent tariff fears and a negative GDP outlook have also weighed in on this previously-hot sector.
The following data center stocks have plunged the most year-to-date in 2025.
An overhead view of a large-scale data center with rows of servers and blinking lights.
Methodology
For this article, I screened the worst-performing data center stocks year-to-date.
I will also mention the number of hedge fund investors in these stocks. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
15. Advanced Micro Devices Inc (NASDAQ:AMD)
Number of Hedge Fund Holders In Q4 2024: 96
Advanced Micro Devices Inc (NASDAQ:AMD) is a semiconductor company whose chips are widely used in data centers.
The stock is down significantly so far in 2025, primarily due to the broad-based decline in AI and semiconductor companies, though there are some internal factors as well.
For example, AMD’s AI revenue outlook for early 2025 disappointed investors despite management projecting strong double-digit growth for the full year. The slower-than-expected ramp-up in AI chip sales led to significant investor concerns.
AMD’s data center revenue grew by 69% year-over-year to $3.86 billion in Q4 2024, and it fell short of the $4.14 billion expected by analysts. It also reported a sharp decline in gaming revenue (down 59% year-over-year) and a 13% drop in embedded segment revenue during Q4.
Following disappointing earnings and guidance, several analysts reduced their price targets for AMD stock.
The consensus price target of $155.14 implies 53.65% upside.
AMD stock is down 16.41% year-to-date.
14. Dell Technologies Inc (NYSE:DELL)
Number of Hedge Fund Holders In Q4 2024: 63
Dell Technologies Inc (NYSE:DELL) was previously seen as a laptop company, but these days, it is increasingly becoming involved in cloud computing and data centers.
The stock is down significantly so far in 2025 as Dell’s fiscal year 2026 revenue forecast of $101 billion to $105 billion fell short of analysts’ consensus expectations of $103.81 billion.
Its Q1 revenue projection of $22.5 billion to $23.5 billion was below the average analyst estimate of $23.59 billion as well.
Plus, Dell experienced headwinds in its core PC market due to unfavorable macroeconomic conditions and slowing demand for consumer electronics.
The consensus price target of $141.24 implies 47.49% upside.
DELL stock is down 16.65% year-to-date.
13. Iron Mountain Inc (NYSE:IRM)
Number of Hedge Fund Holders In Q4 2024: 40
Iron Mountain Inc (NYSE:IRM) is a digital storage company and has data centers.
The stock is down significantly so far in 2025 due to an earnings miss, combined with guidance that missed investor expectations. Iron Mountain’s Q4 2024 earnings slightly missed analyst expectations.
The company posted revenue of $1.58 billion (below the forecast of $1.6 billion) and earnings per share of $0.50 (versus the expected $0.51). Investors were disappointed by this miss.
Iron Mountain’s relatively conservative guidance for 2025 projected revenue growth of 8% to 11% and adjusted EBITDA growth of 11% to 13%. The stock also had a high valuation, so investors expected something more.
The consensus price target of $127.67 implies 47.29% upside.
IRM stock is down 17.59% year-to-date.
12. Belpointe PREP LLC (NYSEAMERICAN:OZ)
Number of Hedge Fund Holders In Q4 2024: N/A
Belpointe PREP LLC (NYSEAMERICAN:OZ) is an opportunity fund with data center and solar operations.
The stock is down significantly so far in 2025 due to the company receiving a noncompliance notice from NYSE American due to its failure to hold its annual meeting by December 31, 2024, as required by Section 704 of the NYSE American Company Guide.
Despite progress in its investment pipeline, Belpointe PREP continues to face significant execution risks and limited cash flow generation. The valuation discount to net asset value (NAV) has narrowed.
Moreover, there are dilution risks, as Belpointe PREP has filed registration statements to offer up to $1.5 billion of Class A units for sale.
OZ stock is down 17.96% year-to-date.
11. NetApp Inc (NASDAQ:NTAP)
Number of Hedge Fund Holders In Q4 2024: 41
NetApp Inc (NASDAQ:NTAP) is a global data infrastructure company that provides unified data storage.
The stock is down significantly so far in 2025 due to NetApp announcing disappointing Q4 FY2025 guidance.
The revenue forecast missed analyst expectations, and broader market concerns about tariffs and economic slowdown exacerbated the decline.
Moreover, NetApp’s Q3 FY2025 results came in with EPS slightly beating estimates at $1.91, with revenue missing estimates at $1.64 billion vs. the expected $1.69 billion.
Net income for Q3 FY2025 fell by 4.4% year-over-year to $299 million, while profit margins decreased from 20% to 18%, driven by higher expenses.
The consensus price target of $129.07 implies 40.32% upside.
NTAP stock is down 20.38% year-to-date.
10. Vertiv Holdings Co (NYSE:VRT)
Number of Hedge Fund Holders In Q4 2024: 92
Vertiv Holdings Co (NYSE:VRT) is a data center and communication networks company.
The stock is down significantly so far in 2025 despite Vertiv reporting solid Q4 2024 results. Adjusted EPS came in at $0.99 and exceeded analyst expectations of $0.82. Revenue increased 26% year-over-year to $2.35 billion.
That’s because Vertiv posted Q1 2025 EPS guidance of $0.57-$0.63, which is below analyst estimates of $0.64. Plus, the broader market unease due to U.S. tariffs on Canadian steel and aluminum negatively impacted Vertiv’s stock price significantly.
And even before that, VRT was one of the biggest losers of the DeepSeek spook.
The consensus price target of $136.07 implies 55.44% upside.
VRT stock is down 23.03% year-to-date.
9. Arista Networks Inc (NYSE:ANET)
Number of Hedge Fund Holders In Q4 2024: 78
Arista Networks Inc (NYSE:ANET) is a networking solutions company. It sells ethernet switches and software, and these are used primarily in data centers.
The stock is down significantly so far in 2025 due to concerns about declining sales to Meta Platforms. Meta accounted for 20% of the company’s revenue a year ago. It now accounts for around 15%.
The company reported better-than-expected Q4 earnings and projected 17% revenue growth for 2025, but investor sentiment was impacted negatively as Meta reduced its orders.
Moreover, there has been some insider selling. Arista’s CTO sold $95 million worth of stock in January 2025.
Arista Networks also provided cautious guidance for 2025 late last year. It projected $8 billion in revenue vs. $8.12 billion expected. The market saw this as bearish.
The consensus price target of $114 implies 36.39% upside.
ANET stock is down 24.45% year-to-date.
8. IREN Ltd (NASDAQ:IREN)
Number of Hedge Fund Holders In Q4 2024: 44
IREN Ltd (NASDAQ:IREN) is mainly a crypto mining company, but it is pivoting strongly to AI and data center operations.
The stock is down significantly so far in 2025 due to Bitcoin topping out and starting to decline. Most risky assets have been sold off by investors this year due to broader market uncertainty.
Plus, there are concerns about the company’s dilution risk since it announced a $440 million convertible senior notes offering late last year.
The consensus price target of $20.4 implies 182.94% upside.
IREN stock is down 26.53% year-to-date.
7. Fastly Inc (NYSE:FSLY)
Number of Hedge Fund Holders In Q4 2024: 27
Fastly Inc (NYSE:FSLY) is a company that provides edge cloud platform.
The stock is down significantly so far in 2025 as its Q4 2024 earnings report left investors disappointed.
The company reported a non-GAAP loss of $0.03 per share, missing the breakeven expectation. Revenue of $140.6 million exceeded guidance, but guidance for Q1 2025 EPS came in significantly below expectations.
Q1 2025 EPS is expected to be between -$0.09 to -$0.05 vs. $-0.01 expected. The full-year 2025 EPS guidance of -$0.15 to -$0.09 also missed the consensus estimate of $0.03 profit. On top of that, revenue guidance of $575-$585 million for 2025 indicated only modest growth of around 7%.
The consensus price target of $8.55 implies 25.27% upside.
FSLY stock is down 27.44% year-to-date.
6. Sterling Infrastructure Inc (NASDAQ:STRL)
Number of Hedge Fund Holders In Q4 2024: 28
Sterling Infrastructure Inc (NASDAQ:STRL) is a company that has e-infrastructure, transportation, and building products.
The stock is down significantly so far in 2025 due to the general slowdown and dissipation of hype surrounding AI and data centers. The company has a lot of its backlog tied to data center projects and AI spending in general.
Also, Sterling’s Building Solutions segment has been affected by a slowdown in residential markets due to affordability issues and high mortgage rates. The Building Solutions’ operating income declined 17% and revenue declined 3% in Q4. Per management, “The decline in operating income is entirely attributable to $1.8 million of earn-out expense related to the acquisition of PPG.”
The consensus price target of $185 implies 52.43% upside.
STRL stock is down 27.87% year-to-date.
5. FuelCell Energy Inc (NASDAQ:FCEL)
Number of Hedge Fund Holders In Q4 2024: 8
FuelCell Energy Inc (NASDAQ:FCEL) is a pretty self-explanatory name since it makes fuel cell and electrolysis platforms. It is also involved in providing power to data centers.
The stock is down significantly so far in 2025 due to continuous losses. FuelCell Energy posted a net loss of $32.4 million, worse than the $44.4 million loss in Q1 2024. It did report a 14% year-over-year revenue increase to $19 million, but cash reserves dwindled to $270.7 million.
Restructuring efforts aim to reduce operating costs by 15%; the ongoing losses have weighed heavily on investor sentiment.
Moreover, FuelCell Energy reported a gross loss of $10.9 million and a revenue decline to $49.3 million compared to $112.1 million in fiscal year 2024.
The consensus price target of $10.03 implies 62.22% upside.
FCEL stock is down 31.64% year-to-date.
4. MaxLinear Inc (NASDAQ:MXL)
Number of Hedge Fund Holders In Q4 2024: 26
MaxLinear Inc (NASDAQ:MXL) is a company that sells high-performance circuits. Its products are also used in data centers.
The stock is down significantly so far in 2025 as it reported a significant revenue decline in its fiscal year 2024, with revenues dropping 48% year-over-year to $360.5 million from $693.3 million in 2023.
This was attributed to macroeconomic conditions and excess inventory in the market. The company’s Q4 2024 revenue also fell 26% year-over-year.
For Q1 2025, MaxLinear projected revenue between $85-105 million.
MaxLinear reported a Q4 2024 GAAP diluted loss per share of $0.68 and projected negative earnings per share for fiscal year 2025.
The consensus price target of $25.5 implies 101.1% upside.
MXL stock is down 35.89% year-to-date.
3. Marvell Technology Inc (NASDAQ:MRVL)
Number of Hedge Fund Holders In Q4 2024: 105
Marvell Technology Inc (NASDAQ:MRVL) is a semiconductor company, and it focuses on data infrastructure solutions.
The stock is down significantly so far in 2025 due to weak Q1 FY2026 guidance. The company projected revenue of $1.875 billion, and it failed to meet analyst expectations and fell short of the $2 billion some had anticipated.
Marvell also faced headwinds from macro softness and inventory missteps. These issues led to GAAP losses of $1.02 per share for fiscal 2025.
The consensus price target of $120.44 implies 75.22% upside.
MRVL stock is down 37.73% year-to-date.
2. Applied Optoelectronics Inc (NASDAQ:AAOI)
Number of Hedge Fund Holders In Q4 2024: 23
Applied Optoelectronics Inc (NASDAQ:AAOI) makes fiber-optic networking products that primarily serve internet data centers, cable TV broadband, telecom equipment manufacturers, and fiber-to-the-home markets.
The stock is down significantly so far in 2025 as Applied Optoelectronics reported a non-GAAP net loss of $0.02 per diluted share in Q4 2024, compared to a profit during the same period last year.
That said, revenue grew slightly to $100.27 million, and concerns over declining margins and profitability overshadowed the positive sales trend.
Moreover, B. Riley lowered its price target for AAOI from $14 to $13 and maintained a “sell” rating due to valuation concerns and operational risks.
The consensus price target of $25.8 implies 16.69% upside.
AAOI stock is down 40.02% year-to-date.
1. ZJK Industrial Co Ltd (NASDAQ:ZJK)
Number of Hedge Fund Holders In Q4 2024: 1
ZJK Industrial Co Ltd (NASDAQ:ZJK) makes precision fasteners, structural parts, and other components that are used in data centers.
The stock is down significantly so far in 2025 due to the company trading at expensive levels as the broader market turned bearish on data center stocks.
The company reported solid revenue growth in 2024, but it still faces supply chain ships. ZJK is also reliant on major clients like Nvidia for revenue growth.
On top of that, Jim Cramer said that the stock had flat revenue growth on CNBC’s Mad Money. The company later corrected this claim made by Cramer, but Cramer’s reach is far more than that of ZJK’s investor relations team, and many still have the wrong idea about the company’s growth metrics.
ZJK stock is down 48.34% year-to-date.
While we acknowledge the potential of ZJK as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ZJK but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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