Despite incredible gains for some leading players in the artificial intelligence (AI) space, there's a good chance that the AI revolution is still just starting to take flight. Investors who back the right players in the space have the opportunity to score big gains with companies that have attractive risk-reward profiles.
With that in mind, read on for a look at two leading AI players that have been identified by some Motley Fool contributors as leading candidates to be the world's top two most valuable companies five years from now.
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Nvidia will still lead
Jennifer Saibil (Nvidia): AI continues to be the strongest trend in business today, and it's much more than buzzy hype. It's already changing how people do everything from read and shop to study and play, and its capabilities are only becoming more powerful as industry leaders invest in upgrading their technology. Nvidia (NVDA 0.74%) is at the center of AI trends. It's the highest valued company in the world today, and it's likely to remain in the top spot as clients need its best-in-class products to boost their own AI businesses.
NASDAQ: NVDA
Key Data Points
Although it's facing new competition from other AI chip designers, it's constantly raising its game to stay in the top spot. It has as much as 95% of the market for AI chips, and it supplies the top AI companies, like Amazon, Microsoft, and Meta Platforms.
These companies have accelerated their investments in AI, and that includes Nvidia's best -- and most expensive -- graphics processing units (GPUs), the chips that drive the most powerful AI capabilities. Together, these three companies are spending at an annual run rate of nearly $300 billion combined, and that's expected to increase.
Nvidia's growth has been wild, especially for a company as large as it already is. In the 2026 fiscal second quarter (ended July 27), revenue increased 56% year over year, and that included a charge related to China sales that couldn't go through.
Management is looking for $54 billion in third-quarter sales, or 54% higher than last year. It's also a profit machine, with a 72.4% gross margin and a 56.5% profit margin in the quarter.
On top of upgrades to its chips, which keep becoming even more powerful, Nvidia is investing in new products like data centers and supercomputers. It just launched Rubin CPX, which it calls an entirely new category of processors that can handle AI reasoning faster and more seamlessly than anything else on the market.
At its current rate of performance and innovation, expect Nvidia to stay on top of the market over the next five years.
Don't underestimate Amazon
Keith Noonan (Amazon): Despite owning and operating the leading cloud infrastructure service, Amazon (AMZN +1.63%) has seen its stock post relatively underwhelming performance amid the rise of AI. While the company's share price has risen 50% over the last five years, the performance comes in far below the 95% gain for the S&P 500's level across the stretch.
Comparing Amazon's gains over the last half-decade to the 148% gain for Microsoft stock and the 1,260% gain for Nvidia produces an even starker contrast.
NASDAQ: AMZN
Key Data Points
Amazon's relative underperformance can be explained by rising competition in cloud computing, pressures from tariffs, and other macroeconomic factors. But while the stock has underperformed the S&P 500 and its peers in the "Magnificent Seven" over the last half-decade, there are some good reasons to think that it could rise to become one of the world's two most valuable companies over the next five years.
While Amazon Web Services (AWS) has seen a rise in competition in the cloud-infrastructure services space, it has also generally continued to post strong growth and encouraging margins. As the leading cloud infrastructure network, there's a good chance that AWS will continue strong growth connected to the launch and scaling-up of new AI applications.
The market's enthusiasm for AWS' momentum has also been dampened somewhat by headwinds that have faced the e-commerce business over the last five years, but that could start to change in the not-too-distant future.
Amazon's online retail business has faced challenges connected to the coronavirus pandemic, high levels of inflation, and tariffs. On the other hand, the e-commerce unit could actually be in the early stages of benefiting from powerful long-term tailwinds.
The combination of AI and robotics stands to make the company's online retail operations significantly more efficient. With new automation technologies, Amazon has the opportunity to dramatically improve margins for its huge e-commerce business and transform its profitability profile at large.
