Although many artificial intelligence (AI) stocks have performed well since "Liberation Day" on April 2, the rough start to the year has weighed on many of them. So severe was the drop in some stocks that many continue to lag the performance of the S&P 500 in 2025 despite dramatic recoveries.
Fortunately, a few have managed to outperform the index. Moreover, some even remain solid buys. Investors looking for AI stocks that can continue to perform should consider these names.
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Taiwan Semiconductor
In a sense, the performance of Taiwan Semiconductor (TSM -1.17%) may not come as a surprise. The company dominates advanced semiconductor manufacturing, as competitors such as Samsung and Intel failed to match its technical prowess.
Consequently, top chip design companies such as Nvidia and Apple outsource most manufacturing to TSMC, which holds a 68% market share in the third-party foundry market. Since such companies cannot run AI workloads without its chips, TSMC is one of the most essential companies in the AI industry.
So, it is little wonder that Grand View Research forecasts a compound annual growth rate (CAGR) for the AI chip industry of 29% through 2030. This means that doubts about the economy are much less likely to affect TSMC.
Indeed, one can find little that is sluggish about TSMC's performance. In the first half of 2025, it generated nearly $56 billion in revenue, a 40% increase from year-ago levels. Over the same period, costs and expenses rose 24%. Thus, its net income of almost $24 billion was 60% higher than in the first two quarters of 2024.
It sells at a P/E ratio of 28. That valuation is unlikely to deter investors, considering its rapid growth, and should translate into gains for TSMC stock over time.
Upstart Holdings
The fact that Upstart Holdings (UPST 5.41%) is a market beater so far in 2025 may come as a surprise. Its stock lost 19% of its value following Q2 earnings. Additionally, it had posted net losses for years before the current quarter. At one point in the 2022 bear market, it had even lost 97% of its value.
Nonetheless, Upstart is worth following, especially considering its ability to transform the credit scoring market. Fair Isaac's FICO score, the industry standard, has not had a major update since 1989.
In contrast, Upstart's model leverages AI to consider attributes overlooked by FICO. It trained its model on over 90 million data points and is working to increase its advantage in AI during the year. Such efforts have helped it uncover loan opportunities overlooked by FICO without adding to lender default risks.
Moreover, amid a sluggish economy, the Fed appears poised to lower interest rates, which should encourage more consumers to take out loans. So far, it mainly scores personal loans, but expanding into auto and home equity loans should significantly broaden its addressable market.
Due to a modest profit in Q2, Upstart has earned only $3.1 million this year. Still, revenue of $426 million in the first half of the year is up 59% yearly.
Also, recent losses temporarily left it without a price-to-earnings ratio. Still, considering its revenue growth, investors are likely to perceive its forward P/E ratio of 39 as reasonable, making it feasible for interested investors to cash in on this potentially lucrative opportunity.
Meta Platforms
Another company banking heavily on AI is social media giant Meta Platforms (META -1.21%). Over 42% of the world's population uses at least one of its social media sites daily.
Amid such saturation, its user base growth slowed to 6%. Thus, to maintain rapid revenue growth over the long term, it leveraged its treasure trove of personal data to help clients train AI models.
In 2025 alone, it pledged between $66 billion and $72 billion in capital expenditure (capex) to compete in this space, investing heavily in technical improvements and data center capacity to maintain its leadership.
Additionally, digital advertising continues to drive growth for now. In the first two quarters of 2025, Meta generated $90 billion in revenue, 19% more than the same period last year. In comparison, costs and expenses grew 10% over the same time, allowing its $35 billion in profit for the first half of the year to rise by 36%.
Despite those increases, Meta's stock sells for around 28 times earnings. Considering its rapid growth and growing role in AI, that valuation should make Meta stock attractive to prospective shareholders.
