The S&P 500 posted a total return of about 17.88% in 2025. While that marked a step down from the exceptional gains of 2024 (+25.02%) and 2023 (+26.29%), it still represented a very strong third consecutive year for U.S. equities. After two standout years, market performance became more selective. Artificial intelligence remained the dominant investment theme, supporting gains in large-cap technology and semiconductor stocks, while higher interest rates earlier in the year weighed on more rate-sensitive sectors such as real estate and utilities. The market also faced a sharp setback in April after new tariff announcements triggered a broad sell-off, but the subsequent rebound in the following months proved resilient, with stocks recovering as earnings remained solid and inflation pressures eased. By the second half of the year, rising expectations for eventual Federal Reserve rate cuts further improved sentiment. Overall, 2025 reflected a continuation of the market’s upward trend, delivering another impressive double-digit gain at a more balanced and sustainable pace following the outsized rallies of the prior two years.
Stock performance across the index varied widely in 2025. Some names delivered outsized gains, while others suffered sharp declines tied to company-specific developments. Below is a look at the S&P 500’s top three performers and bottom three laggards for the year, highlighting the key events and catalysts that shaped their stock price movements.
Top S&P 500 Performers of 2025
Among the top performers in 2025 were Western Digital ($WDC), Micron Technology ($MU), and Seagate Technology ($STX). Each delivered outsized gains, driven by clear catalysts ranging from an AI-fueled rebound in data storage and memory demand to strategic shifts that improved profitability and strengthened their positions within the global data infrastructure ecosystem.
Western Digital ($WDC) +282.23%
Western Digital emerged as the S&P 500’s top-performing stock of 2025, driven by a powerful combination of industry tailwinds and company-specific actions. The data storage company benefited from surging demand for high-capacity storage tied to artificial intelligence workloads, particularly in cloud data centers. This demand lifted sales of enterprise hard drives and flash memory products, many of which carry higher margins, giving the company greater pricing power and helping it return to solid growth.
The rally was also supported by several strategic moves. Western Digital completed the spin-off of its flash memory business, reintroducing SanDisk as a standalone company and allowing Western Digital to sharpen its focus on core storage operations. The company also reinstated its quarterly dividend and authorized a $2 billion share repurchase program, signaling confidence in its financial outlook and capital return strategy.
Improving operating results and a clearer business structure helped shift investor sentiment after years of uncertainty. By the end of the year, Western Digital’s recovery was underscored by its inclusion in the Nasdaq-100 index. Overall, the stock’s near fourfold gain in 2025 reflected both the strength of the AI-driven storage cycle and the company’s successful turnaround.
Micron Technology ($MU) +239.13%
Micron delivered one of its strongest years in decades, with the stock up 239.13% as the company moved out of a deep memory downturn and into a powerful AI-driven recovery. After a prolonged period of oversupply, memory prices rebounded sharply in 2025 as demand from AI data centers surged and available capacity tightened.
As one of the few suppliers capable of producing advanced high-bandwidth memory chips used in AI training, Micron found itself in a favorable position. Data center customers ramped up orders for DRAM and HBM products, giving the company strong pricing leverage. That shift showed up quickly in the numbers. Revenue jumped sharply year over year, and Micron returned to profitability as the memory glut turned into a supply-constrained market.
Throughout the year, Micron consistently beat earnings expectations and raised its outlook, pointing to accelerating AI-related demand. Management acknowledged that, in some cases, the company could only fulfill part of customer orders, highlighting just how tight the market had become. Micron also adjusted its strategy to focus more heavily on higher-margin enterprise and cloud customers, scaling back less profitable consumer-facing product lines.
By year-end, Micron had reestablished itself as a central beneficiary of the AI hardware cycle, with improving margins, stronger cash flow, and a renewed growth story driving the stock’s sharp rebound.
Seagate Technology ($STX) +219.07%
Seagate surprised many investors in 2025, with shares climbing more than 219% as the market reassessed its role in the AI-driven data economy. Long viewed as a mature and cyclical hardware business, the hard drive maker benefited from a sharp increase in demand for large-scale data storage tied to cloud computing and artificial intelligence.
The company leaned heavily into high-capacity drives designed for hyperscale cloud providers and AI data centers, where the explosion of data creation drove urgent storage needs. That shift translated into stronger-than-expected revenue and profit growth during the year. Seagate also gained an edge through the rollout of its next-generation HAMR technology, which enables significantly higher storage capacity per drive and helped secure long-term supply agreements with major cloud customers.
Improving operating results allowed Seagate to strengthen its balance sheet while continuing to return capital to shareholders through dividends and buybacks. Management highlighted that the business had evolved beyond a traditional commodity storage model, with a greater focus on high-capacity, higher-margin solutions built for long-term data growth.
As demand for AI-related infrastructure accelerated, investors rewarded Seagate’s strategic repositioning. By the end of 2025, the company was increasingly viewed as a critical supplier to the expanding AI ecosystem, driving one of the strongest stock performances in the S&P 500.
Worst S&P 500 Performers of 2025
Among the weakest performers of 2025 were The Trade Desk ($TTD), Alexandria Real Estate Equities ($ARE), and Deckers Outdoor ($DECK). Each saw sharp declines driven by company-specific challenges, including slowing growth and valuation resets, deteriorating fundamentals in life-science real estate, and margin pressure tied to tariffs and a more cautious consumer environment.
The Trade Desk ($TTD) -67.70%
The Trade Desk had a difficult 2025, with shares falling 67.70% as investor expectations reset sharply. The downturn began early in the year after the company missed its fourth-quarter 2024 revenue target, its first earnings miss in nearly a decade. That result raised concerns that growth was slowing more quickly than anticipated, especially for a stock that entered the year with a premium valuation.
Revenue growth cooled to the high teens in 2025, down from the mid-20% range the year before, while profit margins narrowed as the company increased spending on product development and partnerships. Those investments, including new AI-driven advertising tools, were aimed at supporting long-term growth but weighed on near-term profitability and sentiment.
The year was further complicated by a series of senior leadership changes, including turnover in key executive roles. These departures unsettled investors and added to uncertainty around execution during a period of slowing growth. At the same time, competitive pressure intensified as major technology platforms expanded their own advertising offerings, raising concerns about pricing power and market share in the programmatic advertising space.
Although The Trade Desk remained profitable and continued to grow its business, the combination of slower growth, higher costs, management transitions, and rising competition led to a sharp reassessment of the stock. By the end of 2025, TTD stood out as the worst-performing stock in the S&P 500, highlighting how quickly sentiment can shift when a long-running growth narrative is challenged.
Alexandria Real Estate Equities ($ARE) -49.83%
Alexandria Real Estate Equities struggled in 2025 as conditions in the life-sciences real estate market deteriorated sharply. The REIT, which focuses on office and laboratory campuses for biotech and pharmaceutical tenants, was hit by a sudden slowdown in biotech funding that led many startups to cut costs and scale back space usage.
As capital became harder to access, vacancy across major life-science hubs rose materially, and Alexandria’s portfolio occupancy declined compared with the prior year. Leasing activity slowed, same-property net operating income fell, and the company was forced to reassess growth assumptions that had been built during a period of rapid expansion. As a result, Alexandria recorded impairments and significantly lowered its earnings outlook, marking a sharp shift from earlier expectations.
Higher interest rates added further pressure to the business, increasing financing costs at a time when cash flows were weakening. To preserve liquidity and strengthen its balance sheet, the company made the difficult decision to cut its quarterly dividend late in the year, a move that weighed heavily on investor sentiment.
By the end of 2025, Alexandria’s shares were down nearly 50%, making it one of the weakest performers in the S&P 500. The decline reflected a broad reset in life-science real estate, as a once-strong growth market adjusted to slower funding, excess supply, and a more challenging macro environment.
Deckers Outdoor ($DECK) -48.95%
Deckers Outdoor had a tough 2025, with shares falling 48.95% as investor expectations cooled. The footwear company, best known for its UGG boots and HOKA running shoes, continued to post solid revenue growth during the year, largely driven by HOKA’s strong brand momentum. However, concerns began to build that growth was slowing and that margins could come under pressure.
Sentiment shifted after management issued a more cautious outlook ahead of the holiday season. The company pointed to a more price-sensitive consumer environment and highlighted the impact of new import tariffs, which were expected to raise costs meaningfully. Deckers lowered its full-year sales forecast, signaling that higher prices and promotional activity could weigh on demand and profitability.
Tariffs on imported footwear created an additional cost burden, forcing the company to balance pricing, promotions, and margins. That outlook unsettled investors, particularly given Deckers’ previously premium valuation. Beyond near-term cost pressures, the market also began questioning the sustainability of growth across its core brands. UGG’s recovery showed signs of maturing, while HOKA faced intensifying competition in the athletic footwear space.
Even though Deckers remained profitable and continued to grow sales in 2025, weaker forward guidance and rising cost pressures led investors to reassess the stock. By year-end, Deckers stood among the S&P 500’s worst performers, reflecting a shift from high growth expectations to a more measured view of the company’s longer-term outlook.
This article is for informational purposes only and is not investment advice or a solicitation to buy or sell securities. The content is based on publicly available information and reflects the author’s opinions as of the publication date, which may change without notice. All investments carry inherent risks, including the potential loss of principal, and past performance is not indicative of future results. Readers should conduct their own research or consult a financial advisor before making investment decisions. BBAE holds no position in the securities mentioned, nor are they compensated by the companies mentioned.
