It's been another banner year for artificial intelligence (AI) stocks. As of this writing, leaders like Palantir Technologies and Advanced Micro Devices advanced 148% and 44% year to date, respectively.
So, with so much optimism surrounding this emerging technology, what other AI stocks should be on the radar of tech-focused investors? Here are two of my favorites.
Image source: Getty Images.
SoundHound AI
First, there's SoundHound AI (SOUN -1.19%). SoundHound is a leading provider of voice AI and agentic AI systems. The company's products help people interact with AI-powered tools, and they are often used in automotive or customer service settings.
As the AI revolution rolls on, communication between humans and AI systems will become increasingly important, and it will be crucial for organizations to make this communication as fast and easy as possible, both for the purposes of customer satisfaction and operational efficiency.
And while I view SoundHound as a years-long investment due to its status as a young company with a long growth horizon ahead of it, there are promising signs that SoundHound is already executing at a high level.
For example, last week the company announced stellar results for the second quarter (the three months ending on June 30, 2025), highlighted by far better-than-expected revenue growth.
In addition to its soaring sales figures, the company announced a narrower-than-expected loss for the quarter and a robust pipeline of pending orders across a wide variety of industries, including healthcare, financial services, retail, restaurants, and automotive.
SoundHound is a stock to watch, especially for investors who are seeking an AI stock that will take many years to reach its full potential. As with any stock, particularly in the AI sector, there are risks. SoundHound remains unprofitable, and competition within the AI sector is robust and fast-changing. Nevertheless, growth-oriented investors should consider SoundHound stock.
Nvidia
Then, there's Nvidia (NVDA -1.73%). It may seem hard to believe, but Nvidia might not be getting enough credit within the AI investment community right now.
Obviously, there's plenty of focus on stocks like Palantir, which have registered massive triple-digit returns year to date, but Nvidia's 36% return is nothing to sneeze at. What's all the more impressive is that Nvidia has achieved that return while its market cap has skyrocketed.
As of this writing, Nvidia has a market cap of $4.4 trillion, the highest of any company. Moreover, its market cap now exceeds its closest rival -- Microsoft -- by some $600 billion.
At any rate, Nvidia remains the king of AI for one very simple -- and very good -- reason: It is the top dog when it comes to AI chips. The company's cutting-edge graphics processing units remain the most desirable hardware within the AI ecosystem, powering massive supercomputers and data centers that are the computing muscle behind the large language models and AI-powered tools that are taking the world by storm.
Looking past the secular AI tailwinds that are powering Nvidia, it's clear the company is taking advantage of its strategic position and deploying capital smartly and efficiently. Gross and operating margins have moved in tandem, with both figures now well above 50%. Similarly, thanks to the company's massive $50 billion stock buyback program, the number of outstanding Nvidia shares has decreased by about 2% over the last three years, despite generous stock-based compensation awards to employees.
Nvidia has already rewarded investors with massive returns in recent years. However, the company's products remain integral to the overall AI ecosystem, which continues to grow rapidly. While there are risks to owning Nvidia stock, including potential AI spending deceleration or trade risks, I believe these concerns are outweighed in the long term. Investors should consider Nvidia stock now.
