Investing in stocks related to Artificial Intelligence (AI) has brought substantial returns for many investors. Given the wide adoption of AI technology across numerous firms, there’s a plentiful array of investment possibilities available.
As a bystander, I find that ventures built around emerging technologies can sometimes be unpredictable. However, it’s not mandatory to accept excessive risk in order to gain access to Artificial Intelligence (AI). Here are four thriving companies I’d like to highlight; they have proven their success and seem poised for long-term triumph.
1. Nvidia
As of July 18, Nvidia (NVDA) stands as the leading AI chip manufacturer globally, boasting a market capitalization of an impressive $4.2 trillion. Despite its high price tag, trading at over 55 times earnings, Nvidia has consistently demonstrated robust growth, with double-digit increases in revenue for nine consecutive quarters in a row.
Given the widespread preference for Nvidia’s graphics processing units (GPUs), which play a key role in generative AI infrastructure, this trend is likely to persist. Major players in AI, often referred to as hyperscalers, are pouring significant resources into data centers. In 2024, they invested approximately $430 billion in data centers, and this figure is projected to escalate to a staggering $1.1 trillion by 2029. Notably, Nvidia accounted for an impressive 92% of the GPU market share in data centers during Q1.
Beyond boasting a leading status in a burgeoning market, Nvidia stands out as an efficiently managed company with an exceptional corporate atmosphere. It ranks fourth on Glassdoor’s list of top workplaces for 2025. Despite its high market valuation, this is a remarkable enterprise that significantly contributes to advancements in artificial intelligence.
2. Taiwan Semiconductor Manufacturing
Taiwan Semiconductor Manufacturing Company (TSMC), commonly referred to as TSMC, is another crucial player in the field of chip production. While other companies design chips, it’s TSMC that takes care of the manufacturing process. Many prominent semiconductor companies, such as Nvidia, Advanced Micro Devices, Apple, and Qualcomm, are among TSMC’s clients.
The significant increase in the need for AI processors has led to a substantial boost in TSMC’s income. In Q1 of 2025, TSMC announced a net revenue of $25.5 billion, marking a 35% rise compared to the same quarter the previous year. Moreover, its profit margin expanded, as earnings per share (EPS) jumped by 54%, reaching $2.12.
A rapidly expanding technology firm may find TSMC to be comparatively affordable. At the moment of this composition, it is trading below 28 times its earnings, significantly less expensive than the Nasdaq-100 index.
3. Alphabet
In the initial phase of 2025, Alphabet (GOOGL, GOOG) witnessed a robust beginning, with its first-quarter revenue soaring by 12% compared to the same period last year, amounting to an impressive $90.2 billion. The operating margin experienced an upward trend, moving from 32% to 34%. This growth also translated into a significant 49% increase in earnings per share (EPS), reaching $2.81.
Despite Alphabet’s share price dropping 2% this year, there seems to be a sense of apprehension surrounding this tech giant, particularly its online search business. Google Search contributed approximately 56% ($50.7 billion) of its revenue in the last quarter. However, the rising trend of chatbots like ChatGPT and other generative AI chat platforms could potentially disrupt that business segment. This is because as more people find their queries answered by these chatbots, they might reduce their web searches.
Alphabet, through AI technology, enhances its product and service offerings. For instance, Google Search results now incorporate AI Overviews, utilized by approximately 1.5 billion users monthly. Although Google Gemini trails ChatGPT, it is the third-largest AI chatbot with a market share of 13.5%. With Google Gemini becoming the standard AI assistant for Android 10 and later devices, I anticipate its market share to expand substantially. Given that Android holds an impressive 74% share of the mobile operating system market as of June 2025, this growth seems likely.
At a price lower than 21 times its earnings, Google’s parent company Alphabet is more affordably priced compared to the S&P 500 index. This presents an excellent chance for investors to acquire one of the leading tech firms without incurring a high premium cost.
4. Amazon
Amazon (AMZN), renowned for its stronghold in online retail, has intelligently implemented AI to optimize its business functions. A recent notable instance is their leadership in mobile robotics manufacturing, achieving a significant milestone last month with the deployment of their one-millionth robot. Additionally, they’ve unveiled a new AI model, DeepFleet, which enhances the travel time of their robotic fleet within their fulfillment network by an impressive 10%.
Last month, CEO Andy Jassy announced that Amazon is currently developing over a thousand innovative AI services and applications, catering to various users such as customers, vendors, and advertisers on the platform, as well as those utilizing Amazon Web Services (AWS).
In the latest financial reports, Amazon’s net sales increased by 9% compared to last year, amounting to approximately $155.7 billion in Q1 of 2025. The increase in Earnings Per Share (EPS) was particularly significant, rising by 62% to reach $1.59. Despite the shares being valued at around 37 times earnings, Amazon is still considered a high-quality Artificial Intelligence (AI) stock that’s worth considering for your investment portfolio.
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2025-07-25 11:54