ARM and Chip Stocks Pull Back on Tariff Fears as ServiceNow, Amazon Lead AI Software Surge

ServiceNow's AI business crossing $1 billion in annual contract value anchored a split session Friday: enterprise software and hyperscaler names posted strong gains while the broader semiconductor complex fell hard, with the SOXX index down 3.2% as the Trump administration's potential tariff expansion rattled chip equipment names and architecture licensors alike. The Nasdaq Composite slid 0.52% and the S&P 500 eased 0.25% to 7,711 as Federal Reserve Chair Kevin Warsh reinforced a higher-for-longer posture at his Jackson Hole keynote, though all three major indexes still closed the week in the green.

Top AI stocks today: August 28, 2026

ACM Research plunges 7.5% on post-earnings profit-taking

ACM Research Inc. (NASDAQ: ACMR), the China-focused semiconductor equipment maker, fell 7.5% Friday in the session''s heaviest percentage loss among AI stocks, extending a volatile stretch in August even after the company posted Q2 revenue of $292.9 million and earnings per share both above analyst estimates. Shares have whipsawed throughout the month as investors weigh a genuinely strong fundamental quarter against an increasingly hostile export-control and tariff backdrop that directly threatens ACMR''s primary market. The stock is still up 66% year-to-date, a stretched valuation that leaves little margin for error on regulatory risk. ACM Research is the kind of AI chip stocks name where headline policy risk can override earnings beat momentum in a single session.

ARM Holdings slides 6.3% as semiconductor tariff expansion risk heats up

Arm Holdings PLC (NASDAQ: ARM) dropped 6.3% Friday as reports indicated the Trump administration is weighing an extension of semiconductor tariffs beyond chip dies to products containing chips, including laptops, gaming consoles, and data center servers. That broadened scope would directly pressure ARM''s largest licensees, among them Apple, Qualcomm, and the cloud hyperscalers that deploy ARM-based Graviton and Ampere processors at scale. ARM stock has now fallen in three of the last four sessions and sits well below its spring highs above $280, though the 5-day print shows modest recovery from mid-August lows. The 108% year-to-date gain leaves the stock pricing in a lot of good news, and any policy confirmation of the expanded tariff scope could push more de-rating. ARM is one of the top AI stocks to watch heading into next week: Broadcom''s September 3 print will be read as a proxy for AI chip demand broadly.

ServiceNow jumps 4.5% as AI revenue hits $1 billion milestone

ServiceNow Inc. (NYSE: NOW) extended its August recovery rally 4.5% Friday, driven by continued momentum from the enterprise workflow giant''s Now Assist platform crossing $1 billion in annual contract value during Q2. Total Q2 revenue of $3.99 billion rose 24% year-over-year, with subscription revenue up 24.5%, and management lifted full-year 2026 subscription revenue guidance to $15.76-$15.78 billion, implying roughly 21% constant-currency growth. Bank of America raised its price target to $150, and Wells Fargo set a $175 target, both citing AI-agent monetization as the primary driver. The 30% one-month gain reflects a sharp re-rating as investors recognize that enterprise AI software, unlike AI chip stocks, carries no direct tariff exposure. NOW is the strongest AI stocks story in enterprise SaaS this summer, and the $1B ACV milestone gives management a concrete monetization proof point heading into fall conference season.

Amazon rises 4% as hyperscaler AI thesis holds through chip sell-off

Amazon.com Inc. (NASDAQ: AMZN) gained nearly 4% Friday in one of the clearest illustrations of the 2026 AI trade''s bifurcation. While AI chip stocks tumbled on tariff fears, hyperscalers like Amazon benefit if compute costs fall or if policy pressure forces AI suppliers to absorb tariffs rather than pass them through. AWS AI-related revenues have been a consistent bright spot in recent quarters, and Friday''s gain in AMZN alongside gains in Microsoft Corp. (NASDAQ: MSFT, +1.68%), Alphabet Inc. (NASDAQ: GOOGL, +1.74%), and Meta Platforms Inc. (NASDAQ: META, +1.21%) underlines a broader Magnificent 7 AI stocks rotation into names that own the customer relationship rather than the supply chain. The best AI stocks to buy in 2026 increasingly look like those sitting above the chip layer.

Notable but quieter

Lam Research Corp. (NASDAQ: LRCX) dropped 5.2%, caught in the same tariff-related selling pressure as other chip equipment names; the stock is down 9% over the past month, giving back gains from the spring. Ouster Inc. (NASDAQ: OUST) fell 5.3% on no company-specific catalyst, continuing a soft patch for the LIDAR sector, which is down 11% over the past month. CrowdStrike Holdings Inc. (NASDAQ: CRWD) slid 4.2%, dragged lower with the broader technology complex despite its cybersecurity focus being largely insulated from chip tariff risk. Teradyne Inc. (NASDAQ: TER), the semiconductor test equipment maker, fell 4.6% on the same tariff-expansion anxiety hitting equipment names broadly. Alibaba Group Holding Ltd. (NYSE: BABA) was a positive outlier, gaining 2.2% as China-AI names caught a bid on improving domestic spending indicators. Across the more than 20,800 AI companies tracked by StartupHub.ai, the overwhelming majority remain private and pre-revenue, underscoring that the top AI stocks in 2026 represent a narrow slice of a much larger buildout.

What to watch next week

Broadcom Inc. (NASDAQ: AVGO) reports earnings on September 3, the first major AI chip stocks name to report since tariff-expansion fears resurfaced Friday; commentary on data center AI demand and any tariff impact on custom ASIC business will set the tone for the sector. C3.ai Inc. (NYSE: AI) follows on September 9 after the close. Fed rate expectations remain in focus after Chair Warsh''s Jackson Hole address, and any follow-on guidance from administration officials on the tariff timeline will be the decisive macro variable for AI stocks to watch heading into September.

What are the top AI stocks to buy in August 2026?

Across hardware, hyperscale cloud, and enterprise SaaS, the consensus top AI stocks in August 2026 include NVIDIA (NVDA), Arm Holdings (ARM), and ACM Research (ACMR) on the chip and chip-equipment side; Amazon (AMZN) for hyperscale AI infrastructure; and ServiceNow (NOW) for enterprise AI software. Friday''s session sharpened a key 2026 thesis: AI chip stocks carry direct tariff exposure that top 2026 AI stocks in the hyperscaler and SaaS tiers largely avoid, making sector selection more consequential than stock picking within those tiers.

Core watchlist

Chips

NVIDIA Corp. (NVDA): -4.57% on very heavy volume (194M shares). Largest weight in SOXX by far; the -3.2% index loss Friday was heavily NVDA-driven. Tariff-expansion headlines are the near-term ceiling; next hard catalyst is the Broadcom print on Sep 3 as a sector read-through.

Advanced Micro Devices Inc. (AMD): -2.33% on average volume. Held up better than NVDA in the chip sell-off; data center GPU demand narrative intact. The 108% year-to-date gain means any tariff escalation still has room to compress the multiple.

Broadcom Inc. (AVGO): -0.74% on average volume. Resilient relative to peers ahead of its own September 3 earnings; custom ASIC business for hyperscalers is the key bull case and will be stress-tested next week.

Taiwan Semiconductor Manufacturing Co. (TSM): -2.29% on average volume. Caught in the chip-tariff sell-off despite manufacturing largely in Taiwan; next catalyst is the monthly revenue release in early September.

Hyperscalers

Microsoft Corp. (MSFT): +1.68% on above-average volume. Clear beneficiary of the chip-to-cloud rotation Friday; Azure AI revenue growth has been the consistent beat driver across the last three quarters.

Alphabet Inc. (GOOGL): +1.74% on above-average volume. Google Cloud AI momentum ongoing; DeepMind product integrations are the multi-quarter narrative with no near-term single-event catalyst.

Meta Platforms Inc. (META): +1.21% on average volume. Llama open-weights strategy continues to differentiate; holding near-term support despite -11% year-to-date overhang from earlier-year de-rating.

Enterprise SaaS

Oracle Corp. (ORCL): -0.72% on above-average volume. Quiet session after a strong recent run; the 16% one-month gain sets a high bar for the next earnings print. AI infrastructure stocks narrative around OCI still intact.

Salesforce Inc. (CRM): +1.57% on heavy volume. Agentforce monetization the core thesis; the 22% five-day and 39% one-month gains signal a breakout move - worth watching for any analyst follow-through next week.

monday.com Ltd. (MNDY): +1.21% on light volume. mondayAI suite expansion the multi-quarter narrative; quiet session on low turnover, next catalyst is the next earnings date.

Vol and retail names

Palantir Technologies Inc. (PLTR): +0.19% on average volume. Nearly flat in the broader churn; the 51% one-month gain is remarkable and leaves the stock technically extended. Government AI contract momentum remains the core narrative.

Tesla Inc. (TSLA): -1.71% on average-heavy volume. Autonomy AI stocks thesis intact but the stock is navigating a -20% year-to-date hole; Dojo compute and FSD regulatory milestones remain the watch items.

Snowflake Inc. (SNOW): -0.34% on light volume. Holding the 50-day moving average near current levels; the 12% one-month gain has stabilized the stock after a rough start to 2026. Next data point is the analyst day later this fall.

Not investment advice.