The stock market declined on Wednesday, with all major indices finishing in the red, driven by losses in technology stocks.

The Nasdaq dropped 0.51%, while the S&P 500 and Dow Jones fell 0.47% and 0.31%, respectively.

Ten companies, mostly from the technology sector, led the downturn.  In this article, we will highlight the biggest decliners and examine the factors driving their performance.

To identify Wednesday’s biggest losers, we focused on stocks with a market capitalization of at least $2 billion and a daily trading volume of over $5 million.

10. Palo Alto Networks Inc. (NASDAQ:PANW)

Cybersecurity firm Palo Alto saw its share prices decrease by 3.9 percent on Wednesday to close at $185.42 apiece as investors sold off positions following news that the US Department of Homeland Security announced plans to cut funds in the agency.

According to former South Dakota Governor Kristi Noem, who will lead the department under the Trump administration, the Cybersecurity and Infrastructure Security Agency (CISA) has gotten far off its mission.

“They are using their resources in ways that were never intended. The misinformation and disinformation that they have stuck their toe into and meddled with should be refocused back onto what their job is,” Noem said.

Palo Alto, a cybersecurity company with deep connections to the government and public sector contracts, stands to be negatively hurt by any potential funding cuts, as such reductions would likely result in smaller, less profitable contracts with government agencies.

9. Nvidia Corp. (NASDAQ:NVDA)

Technology giant Nvidia Corp. fell anew on Wednesday, losing another 4.1 percent to finish at $123.7 apiece, as investors sold off positions while continuing to digest China’s new cost-effective artificial intelligence called DeepSeek.

Nvidia, a key player in powering OpenAI’s ChatGPT with its high-performance GPUs essential for training deep learning models, saw its valuation plunge by nearly $600 billion on Monday. The dramatic drop followed reports that DeepSeek, a new competitor, had been developed using inexpensive alternatives for just $5 million—far less than the $100 million OpenAI invested in training its model.

The news became a low blow to Nvidia and OpenAI, at a time when the US government is set to spend billions of dollars to bolster AI development in the country.

During his inauguration earlier this month, President Donald Trump announced a $500-billion investment in an AI infrastructure among companies namely OpenAI, Oracle, and SoftBank.

8. DataDog Inc. (NASDAQ:DDOG)

DataDog saw its share prices drop by 4.06 percent on Wednesday to close at $145.72 each after investment bank Stifel downgraded its rating on the stock from “buy” to “hold,” saying that the company is expected to face new margin pressures. Stifel also cuts its price target for DataDog by 15 percent to $140 from the $165 previously.

DataDog has been serving up encouraging sales growth, with revenues rising as much as 26 percent year-on-year to $690 million in the third quarter of the year. However, Stifel believed that the potential downside risks are coming in its quarterly reports this year amid margin pressures.

DataDog is expected to release its earnings results for the fourth quarter of the year on February 13, with a guidance of $709 million to $713 million for the full year 2024.

7. TAL Education Group (NYSE:TAL)

TAL Education dropped its share prices by 4.25 percent on Wednesday to finish at $12.4 each as investors sold off positions amid the lack of fresh catalysts to perk up buying appetite.

Just recently, TAL Education reported a 62.4-percent surge in revenues to $606.4 million from the $373.5 million reported year-on-year. The strong performance resulted in the company’s swing to profitability, with net income ending at $38.6 million versus a net loss of $1.9 million in the same period last year.

Operating loss also narrowed by 81 percent to $1.9 million from $10.2 million year-on-year.

Earlier this month, TAL Education launched what it called a “Genius Tutor,” an AI-powered system that transforms learning into an interactive and engaging experience.

6. UiPath Inc. (NYSE:PATH)

UiPath saw its share prices on Wednesday drop by 5.2 percent as investors resorted to profit-taking following a 10-percent increase in its valuation the trading day prior on the back of research reports that 90 percent of IT executives have business processes that agentic AI would improve, while 77 percent said they are prepared to invest in agentic AI this year.

The company stands to benefit from any potential increase in investments in Agentic AI, a probabilistic technology with high adaptability to changing environments and events. It relies on patterns and likelihoods to make decisions and take actions, as opposed to deterministic systems—such as Robotic Process Automation (RPA)—that follow fixed rules and predefined outcomes.

In other news, UiPath received a downgraded rating from several analysts. Earlier this month, Barclays decreased its price target for the company to $15 from $16 apiece, while giving it an “equal weight” rating.

On January 15, Needham & Company LLC reissued a “hold” rating for the company, while Wells & Fargo dropped its target price on UiPath’s stock to $13 from $15 each.

5. Moderna Inc. (NASDAQ:MRNA)

Pharmaceutical giant Moderna saw its share prices drop by 9.39 percent on Wednesday to close at $40.72 each after investment banking firm Goldman Sachs downgraded Moderna’s outlook and price target, citing concerns about revenue visibility.

On Wednesday, Goldman Sachs downgraded Moderna’s stock rating to “neutral” from “buy,” saying that the negative revisions to product revenue guidance suggest that the biotechnology company has limited visibility into the sales trajectory of its respiratory vaccine business. Moderna earlier projected revenues for fiscal year 2025 to settle between $1.5 billion and $2.5 billion.

While recognizing that products in Moderna’s pipeline could contribute to sales in the medium term, including the individualized neoantigen therapy in partnership with Merck, as well as Phase 1/2 cystic fibrosis data in partnership with Vertex Pharmaceuticals, Goldman Sachs said high levels of operating expenses were an additional concern.

4. Danaher Corp. (NYSE:DHR)

Conglomerate Danaher Corp. saw its share prices drop by 9.65 percent on Wednesday to finish at $223.73 apiece after missing earnings per share expectations for the first time in years, having settled at $2.14 versus the $2.16 projection.

In addition, Danaher posted a bearish outlook for the first quarter of the year, anticipating a low single-digit drop in revenues at $5.6 billion as compared with analysts’ expectations of $5.9 billion. However, full-year earnings are projected to inch up by 3 percent year-on-year.

Despite the numbers, Danaher Corp. Chief Executive Officer Rainer Blair said that the company remains hopeful amid resilient order trends in bioprocessing and market share growth in molecular diagnostics.

3. AST SpaceMobile Inc (NASDAQ:ASTS)

Shares of AST SpaceMobile retreated by 12.02 percent on Wednesday to finish at $17.72 apiece following news that technology giants T-Mobile and Apple Inc. chose SpaceX as their partner in integrating support for the Starlink network into the latest software.

The unexpected partnership with SpaceX’s Starlink network signals a potential shift away from reliance on traditional satellite communication providers.

According to sources privy to the matter, Apple has been quietly testing the Starlink service on its iPhones and updated its software earlier this week to support the technology. The development is particularly surprising, as T-Mobile had previously announced that Starlink connectivity would be exclusive to Samsung devices, including models like the Z Fold and S24.

Meanwhile, AST SpaceMobile is still trying to get its own direct-to-cell satellite service up and running. The company launched its first five operational BlueBird DTC satellites last summer but has yet to announce beta service with them.

2. Teva Pharmaceuticals Industries Ltd. (NYSE:TEVA)

Teva Pharmaceuticals’ share prices declined by 13.89 percent on Wednesday to finish at $18.54 each after announcing disappointing earnings guidance for 2025.

Prior to market opening, Teva announced a 3.8-percent increase in revenues to $16.5 billion from the $15.9 billion year-on-year fueled by strong sales in medications for migraines, Huntington’s disease, and schizophrenia.

However, Teva expected lower projections for earnings per share for the year at between $2.35 to $2.65 versus the $2.76 projected by analysts.

According to analysts, the positive revenue growth was not enough to outweigh guidance for 2025.

Teva, however, said it remains committed to its “Pivot to Growth” strategy, emphasizing a reorganization and a strengthened focus on generic medications.

In addition, it plans to resume research and development efforts, particularly in key drugs for ulcerative colitis and Crohn’s disease which it expects to be pivotal in shaping the company’s growth trajectory.

1. Globalstar Inc. (NYSEAMERICAN:GSAT)

Globalstar became the biggest loser in Wednesday’s trading, shedding 17.8 percent to close at $1.57 apiece after news that technology giant Apple Inc. chose to collaborate with Globalstar’s largest competitor SpaceX in linking the Starlink network into the latest iPhone software.

The unexpected alliance with SpaceX dampened the sentiment of Globalstar investors over fears that it represents a potential shift away from reliance on traditional satellite communications providers like Globalstar.

According to sources privy to the matter, Apple has been quietly testing the Starlink service on its iPhones and updated its software earlier this week to support the technology. The development is particularly surprising, as T-Mobile had previously announced that Starlink connectivity would be exclusive to Samsung devices, including models like the Z Fold and S24.

While we acknowledge the potential of GSAT as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than GSAT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of All AI Companies Under $2 Billion Market Cap.

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