Computers have long been celebrated for their numerical prowess, yet they falter in areas that humans navigate with ease, such as language processing, visual perception, and reasoning. Artificial Intelligence (AI), encompassing deep learning and machine learning, bridges this gap by enabling computers to perform tasks that typically require human intelligence, such as language generation and facial recognition. This technological leap has spurred the rise of AI stocks, which are publicly traded companies that develop or employ AI technology as part of their business. These companies span sectors like semiconductors, software, and robotics, leveraging AI in innovative ways that set them apart from their peers.
Companies are harnessing AI in various forms, including machine learning, robotics, generative AI, autonomous vehicles, neural networks, and agentic AI. Machine learning involves training machines using vast amounts of data to make inferences from new data. Robotics enables machines to act without human intervention, while generative AI creates text, images, and video in response to human prompts. Autonomous vehicles are designed to operate without human assistance, and neural networks mimic the human brain to enhance capabilities like natural language processing and image recognition. Agentic AI agents perform tasks such as customer service autonomously.
Investing in AI stocks has become increasingly popular due to the sector’s growth potential. However, it comes with its own set of pros and cons. On the positive side, there is significant growth potential, building momentum, and reasonable valuations. The technology could be as disruptive as the internet. On the downside, a bubble could be forming, and it’s unclear whether the capital expenditure spending is justified. Additionally, AI stocks are becoming riskier as they grow more expensive, and most new technologies experience a crash at some point.
According to the International Data Corporation, the global artificial intelligence market is expected to grow from $235 billion in 2024 to more than $631 billion in 2028. This rapid growth presents ample opportunities for companies to profit from AI. While picking stocks in a growth industry is uncertain, several top AI stocks are worth considering.
Leading the pack is Nvidia, a graphics processing unit (GPU) company that has capitalized on the AI boom. Nvidia’s GPUs have become the standard in data centers worldwide, essential for both the training and inference phases of generative AI. The company’s data center business now dominates its revenue, driven by the surge in demand for AI infrastructure. Nvidia’s chips are crucial for running demanding workloads required by large language models (LLMs), and its new Blackwell platform has been deployed by major cloud infrastructure services in 2025, with demand outstripping supply. The company’s next iteration, the Rubin platform, is expected to launch in the second half of 2026.
Nvidia is also focusing on self-driving cars and “physical AI,” developing hardware and software platforms for driver-assistance features and fully autonomous driving. Although automotive revenue currently accounts for a small fraction of the company’s revenue, this could change as the autonomous vehicle industry evolves. Tesla’s launch of its robotaxi network in Austin and the Bay Area indicates a heating up of the autonomous vehicle race, which bodes well for the semiconductor sector. Nvidia’s professional visualization segment, including its Omniverse, also holds potential in AI. Despite the possibility of more specialized processors emerging, Nvidia is well-positioned for now.
Alphabet has been preparing for the AI revolution for years, acquiring the AI research lab DeepMind in 2014. It leads in autonomous vehicles through its Waymo subsidiary, which operates driverless cars in cities like San Francisco and Phoenix. Alphabet launched Gemini, its AI chatbot, which some view as a threat to Google Search. However, concerns about a challenge to its search dominance seem overblown, as Alphabet’s ad revenue continues to grow steadily. The latest version of Gemini, Gemini 3, has prompted OpenAI to issue a “Code Red” in response to the competitive threat. Gemini 3 offers improvements in understanding context and intent, and Meta is reportedly planning to buy Alphabet’s AI chips, known as TPUs, indicating direct competition with Nvidia.
With information central to its business, Alphabet has prioritized AI, rolling out AI tools for Google Cloud and Google Workspace, including a generative AI assistant for writing emails. Its customer acquisition strategy in the cloud is based around AI, targeting AI start-ups for its cloud infrastructure service. AI also enhances its search engine and YouTube, pinpointing relevant video sections for users. Alphabet plans to allocate $75 billion to AI infrastructure and related needs in 2025.
Microsoft has gained attention through its partnership with OpenAI, investing $10 billion following the launch of ChatGPT. After OpenAI’s restructuring, Microsoft holds a 27% stake in the company,
