Commonly referred to as a “picks and shovels” stock, it will help you gain exposure to the wider AI industry. That’s because Broadcom partners with Google (aka Alphabet) and OpenAI, to name a few. Alphabet (GOOGL +0.88%) has been preparing for the AI revolution for years, acquiring the AI research lab DeepMind in 2014.

  • Their platform allows users to develop, deploy, and operate large-scale AI applications with ease.
  • Field Materials, a construction tech startup, has raised $10.5 million in a Series A funding round.
  • As AI gathers momentum, its adoption is accelerating across industries such as financial services, healthcare and manufacturing, to name just a few.

Nvidia develops hardware and software platforms that can power driver-assistance features and fully autonomous driving, which could be a significant source of revenue if that industry takes off. Automotive revenue accounts for only a small fraction of the company’s revenue, but that could change. Well-run, high-margin, adaptable businesses that support the development, training and deployment of AI applications are well-positioned for growth as the technology evolves. Nvidia designs and sells high-performance semiconductors and related hardware and software. The company’s hardware is used in AI-capable data centers, gaming applications, robotics and automotive applications.

She holds a BSc from the London School of Economics and an MA from the University of Texas at Austin. The company is best known for its Snapdragon processors, which are widely used in mobile devices. Its Snapdragon processors for laptops are designed with AI at the core. These chips offer on-device AI processing, which helps reduce delays and boost performance. Micron is vulnerable to the cyclical nature of the semiconductor and memory markets.

Investing in AI Stocks: A Comprehensive Guide to the Future of Technology

By assessing essential financial metrics, investors can identify the most promising AI stocks, thereby maximizing their investment opportunities in this transformative sector. Alibaba is also using AI to enhance its AI platform, automating tasks like product listings, as well as making recommendations and product search easier. It plans to invest more than $50 billion in AI infrastructure, opening new data centers around the world. Persivia, a leader in AI-driven digital health solutions, has secured $107 million in a recapitalization with Aldrich Capital Partners. Based in Marlborough, MA, the total raised is not specified, but this ai companies to invest in recapitalization supports Persivia’s mission to transform care delivery with AI, with a focus on value-based care and population health management. AI stocks are shares of companies that primarily focus on developing and implementing artificial intelligence technologies and solutions.

  • Morningstar categorizes Teradyne as a wide-moat company, meaning it has a significant and enduring competitive advantage.
  • AI stocks span sectors such as semiconductors, software, robotics, and even beyond technology, representing companies that are using AI in ways that set them apart from their peers.
  • The company also relies on the Taiwan Semiconductor Manufacturing Co. for its chip production.
  • AI-driven automation enhances efficiency, leading to reduced costs for businesses.

The company has long-term relationships with major chip foundries, including Taiwan Semiconductor, Intel and Samsung. Those foundries cannot easily switch to another provider since a tooling change would require expensive downtime. TSM has a long track record of performance and growth, built on technological expertise. The well-managed company is also critical to the AI infrastructure buildout. While Nvidia, Apple and AMD are designing the chips that will power the AI revolution, TSM is making them.

Taiwan Semiconductor Business Overview

This funding will be used to expand the platform’s capabilities and grow the team, aiming to unify product development tools in the era of AI. Based in Bellevue, WA, Statsig has raised a total of $153 million, with this round valuing the company at $1.1 billion, highlighting its focus on A/B testing and feature management for product teams. Hex Technologies, a provider of a unified, AI-powered workspace for data science and analytics, has secured $70 million in a Series C funding round. The round was led by Andreessen Horowitz and Sequoia Capital, with participation from existing investors.

Nvidia

It launched Azure AI Foundry in November 2024, enabling its customers to create and manage AI apps and agents. As of April 2025, developers at more than 70,000 companies were using it. Machine learning and neural networks are very much at the center of the company’s autonomous vehicle and Optimus autonomous robot projects. Computers excel at crunching numbers but struggle with tasks that many people do with ease, like language processing, visual perception, object manipulation, reasoning, planning, and learning. Morningstar quantifies its 15-year total return at 23.7%, which outperforms peers in the software infrastructure industry.

Disadvantages of AI Stocks

Here are the AI stocks with the highest total return in the last 12 months. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. Similar to Alphabet, it has one of the lowest valuations among the “Magnificent Seven” stocks in the market (Tesla was removed from this chart because its valuation is extremely high and skews the chart). Her work has appeared in numerous publications including TheStreet, Mansion Global, CNN, CNN Money, DNAInfo, Yahoo! Finance, MSN Money, and the New York Daily News.

This will pressure the dominant hardware providers to evolve to meet those changing priorities. It’s based on hard funding data, compiled from verified sources, and reflects what investors are actually backing in 2025. AI technology is increasingly facing scrutiny from governments and regulatory bodies worldwide. Concerns over data privacy, algorithmic bias, job displacement, and national security risks could lead to stricter regulations that impact operations and growth prospects. The legal landscape around AI is still in its early stages, and new laws around transparency, intellectual property rights, and ethical AI development are being fleshed out.

Alphabet’s primary business, Google Search, is also adapting to the changing landscape by merging generative AI with a traditional search experience through its AI search overviews. I’m bullish on Alphabet and think it has a ton of room to run even after the stock saw strong performance in 2025. Alphabet (GOOG +0.78%) (GOOGL +0.88%) is one of the AI hyperscalers that are pouring a ton of money into AI computing capacity. Not all of this is for internal use, as its cloud computing division is also seeing massive demand for AI computing power from its clients.

The dip creates a nice buying opportunity for a company that will be essential to semiconductor manufacturing for the foreseeable future. TSM is the world’s leading semiconductor foundry with an estimated market share of 61%, according to Statista. TSM customers include leading chip designers that outsource manufacturing, such as Nvidia, AMD and Broadcom. Spending on AI infrastructure will likely continue, but the pace and focus of that spending may change. TechInsights predicts a greater emphasis on cost efficiency over performance.

Broadcom

With Tesla (TSLA +2.61%) having launched its robotaxi network in Austin, the autonomous vehicle race appears to be heating up, which should be good news for the semiconductor sector. It has been adding both internal and third-party models to products like Microsoft 365 Copilot and Azure, including DeepSeek’s R1. Microsoft (MSFT -0.17%) has gotten lots of buzz lately, thanks to its partnership with OpenAI. The tech giant began investing in the tech start-up in 2019 and invested another $10 billion in OpenAI following the launch of ChatGPT. Tesla introduced its driverless Cybercab in October 2024, and the company hopes to begin producing the vehicles by 2026. It launched its robotaxi network in June, though with just a handful of vehicles, and Musk envisions an expansion to other cities in the near future.

A McKinsey report characterizes 2023 as the year “the world discovered generative AI (gen AI).” 2024 is when businesses began realizing value from using gen AI. The rising adoption has sparked extreme demand for AI-capable computing power. Data centers, in turn, invested billions in hardware and software for powering, developing and training AI applications. C3.ai focuses on delivering AI software solutions for various industries, helping businesses accelerate their digital transformation.

GPU chips, which were once used primarily for rendering video games, support both phases well. Nvidia’s ambitions have gone beyond GPUs, as the company now aims to build AI factories or data centers full of Nvidia components to run AI applications and programming. The company provides cloud software and specializes in data fusion that helps its customers gain important insights by connecting disparate pieces of information hidden within data. According to International Data Corporation, the global artificial intelligence market is expected to grow from $235 billion in 2024 to more than $631 billion in 2028. While the AI market is already large and continues to grow rapidly, plenty of companies can still profit from AI.

AI stocks are publicly traded companies that develop or employ AI technology as part of their business. AI stocks span sectors such as semiconductors, software, robotics, and even beyond technology, representing companies that are using AI in ways that set them apart from their peers. The track record of performance is comforting, but it looks even better alongside Synopsys’ current positioning. The company’s product suite will support the AI revolution directly by enabling ongoing innovation in integrated circuit design and manufacturing. Synopsys is also in the process of acquiring engineering simulation provider Ansys (ANSS).

Although picking stocks in a growth industry comes with a lot of uncertainty, these top AI stocks are all worth considering. Envato expands Shutterstock’s offering with a subscription for unlimited downloads—formerly a gap in the SSTK’s product suite. The company is also seeing organic momentum, with improvements in content performance and growth in its Data, Distribution, and Services segment. ASML is the dominant market share leader in photolithography machines for semiconductors.