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Talk about unforgiving! The great enterprise stock sell-off of 2026 recommenced on Wednesday, and it dragged down a couple of companies—Unity Software and Shopify—after they each reported decent December-quarter earnings. Shares of Shopify, most egregiously, fell as much as 12% after the e-commerce software platform said its first-quarter revenue would grow “at a low-30s percentage rate on a year-over-year basis,” in line with its fourth-quarter growth rate. Even for Wall Streeters used to explaining market gyrations after the fact with aplomb, this proved puzzling. Research firm William Blair headlined a report on Shopify’s earnings: “Strong Results and Growth, but Shares Down for No Obvious Reason.”
Shopify has been about as AI forward as is possible for a software firm to be, working with both OpenAI on its Instant Checkout shopping venture and Google on its AI shopping efforts. But as New Street Research said Wednesday, Shopify’s “AI narrative is strong but SaaS sector anxiety overwhelms,” using industry jargon for software as a service firms. It seems the Street needs some therapy, or at least some antianxiety medication. Shopify’s stock recovered a bit, but it still ended up closing down 6.7%.
The picture at Unity isn’t quite so clear-cut, although the stock’s 26% plunge also felt like an overreaction. Early Wednesday, Unity reported 10% higher revenue—by far its strongest quarter of the year—and forecast a slightly higher growth rate in the first quarter of 2026. Those are certainly not high-growth numbers. But we already know Unity is exposed to the travails of AI: Most obviously, it sells software to help people develop games. (When Google last month unveiled its Project Genie AI tools, which people can use to easily make videogames, Unity shares plunged 27% in a couple of days.) Unity’s biggest business is an ads-in-mobile games tech business, which in recent years has lost market share to AppLovin, although Unity is now reporting progress with a new AI-powered ad product. While investors may have good reason to be skeptical, there was nothing new in Wednesday’s earnings report that justified knocking the stock down by a quarter. Unity shares have fallen more than half so far this year.
We’re in the phase where investors are selling first and thinking later—or maybe not at all. Earlier this week, for instance, insurance stocks sold off after OpenAI’s ChatGPT added a couple of insurance apps, Tuio and Insurify, to its app store so ChatGPT users could use them in the chatbot. Both apps, which are already available in mobile app stores, offer consumers a chance to get an insurance quote. There’s nothing revolutionary about that. And yet some people apparently interpreted their availability on ChatGPT as spelling doom for the existing industry. Nutty.
Similarly, stocks of brokers and wealth managers were hit this week after wealth management firm Altruist announced a new AI-powered tool. Investment manager Ross Gerber said on The Information’s TITV today he was an investor in Altruist but the selling over the new tool was “so overblown,” adding that “everybody's in panic mode …but there's a lot of building that needs to be done before any of these systems actually work in scale.”
Lyft Drives Into Ditch
On the other hand, investors may have been justified in selling Lyft, whose stock tumbled 17% on Wednesday, in the wake of its fourth-quarter earnings report, released Tuesday night. On the surface, the numbers looked fine. While revenue grew only 3%, that was due to some wonky regulatory changes, which dampened reported revenue. Excluding that factor, revenue grew 13.5%, in line with the previous few quarters.
But research firm MoffettNathanson published a report Wednesday morning that perhaps explains the negativity. It estimates the growth rate of Lyft’s U.S. ride-share business fell by half through 2025, to just 7%, which it attributes to Lyft raising prices more than Uber. “As a result, we expect Uber is aggressively taking share from Lyft,” the report stated.
As MoffettNathanson said, Lyft can’t let this go on. It will have to do something drastic to win back passengers, which could hurt its profit margins. In that context, the sell-off makes sense.
In Other News
• Hedge fund manager Bill Ackman’s Pershing Square Capital Management last year bought stakes in Meta Platforms and Amazon, adding to a portfolio already heavy with big tech stocks Alphabet and Uber.
• EssilorLuxottica and Meta Platforms sold more than 7 million pairs of smart glasses in 2025, Essilor reported on Wednesday, a huge improvement on 2024. Essilor had reported a year ago that only 2 million pairs had been sold since the product launched in 2023.
• Target said this week that it will be one of the first advertisers working with OpenAI as it launches ads in ChatGPT. Target also said that brands that advertise through its Roundel retail media business will be able to participate in the ads pilot.
Today on The Information’s TITV
Check out our latest episode of TITV in which we unpack ServiceNow’s current valuation with our financial analysis columnist.
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